The cryptocurrency market has been under significant pressure, and XRP is no exception. As of Monday morning, Ripple (XRP) was trading at $2.20, marking a decline of over 35% from its highest level this year. This price movement has led to growing concerns among investors, with analysts like Jesse Colombo warning of an impending crash.
Jesse Colombo Predicts XRP Price Breakdown
XRP’s downward trajectory aligns with the overall weakness in the crypto market. Bitcoin (BTC), often seen as a benchmark for digital assets, has fallen from its all-time high of $109,300 to $82,000. Given Bitcoin’s influence, most altcoins have suffered even steeper declines.
Ripple’s struggles are compounded by uncertainty surrounding the approval of a Strategic XRP Reserve. According to data from Polymarket, there is only a 24% chance that the U.S. government will establish such reserves. While the approval of a Strategic Bitcoin Reserve seems more feasible, the likelihood of XRP and other altcoins being included remains doubtful. This uncertainty has dampened investor sentiment, further driving the XRP price lower.
Jesse Colombo, a well-known market analyst with over 70,000 followers on X (formerly Twitter), has pointed to a bearish pattern forming on XRP’s price chart. He highlights the development of a head and shoulders pattern, a classic reversal indicator that often precedes significant downturns.
Head and Shoulders Pattern Signals Bearish Outlook
A head and shoulders pattern consists of three peaks:
- The head represents the highest point in the pattern, which in this case is XRP’s year-to-date high of $3.40.
- The shoulders are two smaller peaks on either side, forming around the $3 level.
- The neckline is the support level connecting the lowest points of the troughs between the peaks, which currently stands at $2.
Technical analysts warn that a break below the $2 neckline could lead to a sharp drop, with XRP potentially plunging to $1. This would represent a further decline of approximately 55% from its current level.
Wyckoff Theory Suggests XRP’s Bearish Phase is Just Beginning
In addition to the head and shoulders pattern, the Wyckoff Theory further supports a bearish outlook for XRP. This technical analysis model outlines four key market phases:
- Accumulation Phase – A period of consolidation, typically following a major decline.
- Markup Phase – A strong uptrend characterized by increasing demand and price appreciation.
- Distribution Phase – A period of sideways movement, where large investors offload their holdings.
- Markdown Phase – A sharp decline driven by rising supply and reduced demand.
Since 2020, XRP has largely remained in the accumulation phase, followed by a breakout into the markup phase in November 2023. However, recent price action suggests that the token has now entered the distribution phase, where major investors sell off their holdings, leading to increased volatility and price stagnation.
The final phase, markdown, is characterized by significant price declines, as supply overwhelms demand. If this phase plays out as expected, XRP could see further losses in the coming weeks.
XRP Price Forecast: How Low Could It Go?
Given the combination of bearish technical indicators and macroeconomic headwinds, analysts have outlined potential downside targets for XRP:
- Immediate Support Level: $2 (neckline of head and shoulders pattern)
- Key Psychological Support: $1.50
- Worst-Case Scenario: $1 (55% drop from current levels)
If XRP falls below the $2 neckline, a retest of $1.50 is likely, followed by a potential slide to $1 if bearish momentum accelerates.
Broader Market Factors Affecting XRP’s Price
Beyond technical analysis, several macroeconomic and industry-specific factors are impacting XRP’s price movement:
1. Bitcoin’s Influence on Altcoins
Bitcoin remains the dominant force in the crypto industry, dictating broader market trends. With BTC currently facing resistance around $82,000 after its recent all-time high, altcoins like XRP are struggling to maintain bullish momentum.
2. SEC vs. Ripple Lawsuit and Regulatory Uncertainty
The ongoing legal battle between Ripple and the U.S. Securities and Exchange Commission (SEC) remains a critical factor for XRP’s price trajectory. While Ripple has scored some victories in court, the uncertainty surrounding the case continues to weigh on investor confidence.
3. Lack of Institutional Adoption
While Bitcoin and Ethereum (ETH) have gained institutional interest, XRP has yet to see widespread adoption by major financial firms. The uncertainty surrounding regulatory approval for XRP-based financial products has hindered its growth.
Final Thoughts
The current market conditions, combined with bearish technical signals such as the head and shoulders pattern and Wyckoff Theory, suggest that XRP may be headed for further declines. Analysts remain cautious, advising investors to monitor key support levels closely. Whether XRP can regain bullish momentum will depend on broader market trends, regulatory developments, and renewed investor confidence in Ripple’s ecosystem.
