XRP has witnessed a dramatic collapse of 85% from its all-time high, but market data suggests there may be chances of a recovery.

Market analyst Northstar first called attention to this bearish situation. Notably, XRP peaked beyond $3 in January 2018, following an impressive surge from the $0.005 low in February 2017.

The cryptocurrency has since plummeted by 85%, trading around $0.48 at the time of Northstar’s analysis. This massive decline has raised speculation about XRP’s future trajectory, but market data indicates that the crypto asset might still boast chances of a rebound.

Notably, a long-term symmetrical triangle, identified by Northstar on the two-week chart, shows XRP’s struggle since its peak. The chart shows multiple failed attempts to break above the triangle’s resistance, ultimately resulting in a breakdown below the support line at around $0.55.

This breakdown is critical, as it indicates an increase in the bearish momentum. The triangle’s measured move suggests a potential bearish target of $0.30 if the selloff momentum continues, marking a further decline of nearly 40% from current levels.

XRP Current Market Position

Meanwhile, on the weekly chart, a smaller XRP symmetrical triangle pattern, formed following the drop from $0.93 last July, recently saw a breakout. XRP breached the triangle’s upper trendline, reaching resistance at the middle Bollinger Band around $0.65.

However, the recent market drop has led XRP to retest the upper trendline, now acting as support around $0.48. XRP needs to fiercely defend this support to hedge against any drop back into the symmetrical triangle.

XRP 1W Chart

Nonetheless, the Stochastic Momentum Index (SMI) shows a downward trajectory, indicating weakened buying pressure. If XRP fails to reclaim the $0.52 resistance, the next support levels are critical.

Notably, the $0.4270 support, marked by the lower Bollinger Band, is a key level to watch. A breach below this could see XRP targeting $0.30, consistent with the descending triangle’s measured move.

Volatility and Market Activity

As market uncertainty prevails, data sourced by Santiment shows an interesting relationship between price volatility, active addresses, and XRP’s price. Notably, XRP experiences massive price movements, both upward and downward, during periods of increased volatility and active addresses.

XRP Volatility and Active Addresses | Santiment

For instance, major price spikes in late 2017 and early 2018 correspond with heightened volatility and active addresses exceeding 200K. Similarly, the price drop in mid-2021 following a rally to $1.96 aligns with spikes in these metrics.

Currently, active addresses hover around 25.9K, while volatility remains moderate. This scenario suggests the potential for upcoming price swings. If volatility increases with active addresses, as seen historically, XRP could experience significant movement from the current level.

What’s Next for XRP?

Given the current technical setup, XRP could face a challenging path ahead. The six-year symmetrical triangle breakdown on the 2-week chart and one-year symmetrical triangle retest on the 1-week chart suggest bearish continuation or potential consolidation.

Key levels to monitor include the $0.52 resistance and the $0.40 support. Failure to hold these levels could validate the bearish targets, with $0.30 being a critical risk for the downturn.

However, the momentum could shift. An increase in volatility and active addresses, as indicated by Santiment’s data, could lead to price swings. If buying pressure returns, reclaiming the $0.52 level could negate some bearish sentiment. In such a scenario, XRP might aim for higher resistance levels around $0.60 and $0.70.