XRP hovered near $1.30 on Thursday, as a bearish chart signal raised the possibility of another sharp decline towards $1.
The cryptocurrency has struggled to sustain a recovery despite fresh institutional announcements from Ripple.
A crossover between two closely watched moving averages is now adding to concerns that a break below $1.25 could trigger further selling.
However, a separate indicator is flashing a potential buy signal, leaving traders with sharply competing scenarios for XRP’s next move.
XRP’s bearish crossover raises fears of another 30% decline
The warning emerged last week, when XRP’s 20-day exponential moving average slipped below its 50-day average.
The crossover suggests that shorter-term momentum has weakened relative to the longer-term trend, leaving any recovery vulnerable to renewed selling.
Crypto analyst ChartNerd, in an assessment covered by DailyCoin compared the formation with an earlier crossover that coincided with a decline of roughly 30%.
During that previous downturn, XRP fell from approximately $1.40 to below $1.
A comparable percentage decline from $1.32 would put the token near $0.92, although historical chart patterns are not reliable forecasts of future prices.
The concern is that XRP has struggled to regain its key moving averages, suggesting that sellers continue to dominate shorter-term trading.
Why losing $1.25 could expose XRP to a deeper sell-off
The next major danger lies in a technical area known as a fair value gap, where trading activity was comparatively uneven during an earlier price move.
Analysts identified a gap extending from approximately $1 to $1.25.
They identified $1.248 as a crucial breakdown level and considers a potential return towards $1 an opportunity to accumulate XRP rather than necessarily the beginning of a prolonged collapse.
A sustained move below that threshold could encourage further selling, particularly if leveraged traders begin closing bullish positions.
Recent on-chain developments offer another reason for caution. Rising XRP balances on cryptocurrency exchanges alongside signs that some large holders had reduced their exposure.
Such transfers can precede selling, although they do not necessarily mean that investors are preparing to liquidate their holdings immediately.
Can XRP defend $1.25 as another indicator signals a rebound?
Despite the bearish setup, some analysts believe selling pressure could be approaching exhaustion.
Ali Martinez identified a TD Sequential buy signal on XRP’s three-day chart. He observed that the previous three comparable signals preceded rallies of 31%, 24% and 18%, suggesting a recovery remains possible.
However, Martinez made that outlook conditional on XRP defending $1.25.
Holding support could allow the cryptocurrency to recover towards $1.40, while a breakdown accompanied by further selling from large holders could expose $0.98.
The immediate challenge is closer.
Analysts placed initial resistance around $1.35, followed by moving averages near $1.36–$1.37. Reclaiming those levels would strengthen the recovery case and challenge the bearish outlook.
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