Key Takeaways:
XRP fell 6.6% to near $1.37 on Aug. 26, the worst performance among the top 10 cryptocurrencies, as an overbought rally that lifted the token nearly 70% in five days unwound.
"The pullback is a healthy correction resetting overbought conditions rather than a trend reversal," ChartNerdTA, a crypto analyst, said. The surge was a genuine breakout driven by a liquidity trap for short sellers and positive funding rates, he said.
XRP rocketed from a cycle low of $0.9877 on Aug. 17 to a three-month high of $1.69 by Aug. 22, outpacing Bitcoin's 23.6% and Ethereum's 28.1% gains over the same stretch. The daily RSI reached 88, a level last seen during July 2025's all-time high near $3.65, before the token slid 18% from its $1.70 peak into the $1.40-$1.38 range. Long liquidations reached $4.66 million, up 31.82% in a single day, CryptoQuant analyst Pelinay said, warning that selling pressure could persist before any stabilization.
The critical battleground sits at $1.40. A daily close below that level would expose structural supports between $1.30 and $1.20, with a deeper breakdown risking a return toward $1.00, ChartNerdTA said. Reclaiming the weekly 50 EMA near $1.54 would restore short-term bullish control and open a path back toward $1.70, with longer-term targets extending toward $1.80-$2.00 if momentum returns.
Not every signal is bearish. XRP-linked ETFs logged six consecutive days of net inflows, according to SoSoValue data, suggesting the current weakness reflects a leverage unwind rather than institutions exiting positions. Goldman Sachs holds $86.5 million across five XRP exchange-traded funds, according to its second-quarter filing, after selling its entire $153.8 million position in the first quarter.
The pullback follows a week of macro-driven gains. XRP rallied from $1.16 to $1.43 in a single session after the US Treasury said it would at least double buybacks of long-term government bonds, a move that pushed money toward riskier assets and closed out roughly $1.4 billion of short bets in four hours. Bitcoin cleared $80,000 for the first time in months before cooling back toward $78,000, dragging altcoins lower as traders braced for core PCE inflation data and Nvidia's earnings.
Traders are also watching the Senate's Sept. 15 vote on whether to advance the CLARITY Act, which would classify XRP as a commodity under federal law. The vote is a procedural cloture test requiring 60 senators, with Republicans holding 53 seats. XRP's record high is $3.84, set on Jan. 4, 2018, and the token would need a 172% gain to reach it.
This article is for informational purposes only and does not constitute investment advice.
