XRP is trading around $1.99, down about 1% over the past twenty-four hours. Despite broader market volatility, it is only down about 4% over the week, showing relative stability compared to many altcoins like ADA and BCH.
Most importantly, the chart shows an early bullish reversal signal. This setup has not yet been confirmed, but if one key level holds, the short-term bounce probability, at least 9%, will increase significantly.
The upward divergence is shown while the price of XRP defends the key support.
XRP formed an upward divergence on the daily chart between December 1 and December 14. An upward divergence occurs when the price makes lower lows while the Relative Strength Index (RSI) makes higher lows. The momentum indicator measures buying and selling strength. When the RSI improves while the price weakens, it often indicates that selling pressure is fading.
On the daily chart, a standard upward divergence like this can lead to a trend reversal — from bearish to bullish.
However, this divergence alone is not enough. It only matters if the price of XRP supports the price.
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This support is approaching $1.97. XRP has repeatedly defended this area, and on-chain data helps explain why.
The cost basis heat map shows a dense cluster of XRP purchased between approximately $1.97 and $1.98.
About 1.79 billion XRP has accumulated in this range. The cost basis heat map shows where large groups of holders bought their coins. When the price trades near these levels, holders are less likely to sell at a loss, reinforcing support.
As long as XRP stays above $1.97, the bullish divergence theory remains valid, provided that the RSI reading stays strong.
Why is $2.17 the first real test for the bulls?
If support continues, XRP has room to rise. The first upward target is approaching $2.17, which is an almost 9% move from current levels.
This level is important because the cost basis heat map shows a significant range between $2.16 and $2.17. About 1.36 billion XRP was acquired in this area. This makes it a strong resistance zone, where selling pressure is likely to appear.
If the price of XRP rises to $2.17 with a daily candle close, it may open the way towards $2.28, then $2.69, and ultimately $3.10. However, these levels remain secondary for now and depend on broader market conditions.
The rejection is clear. A daily close below $1.97 would weaken the reversal setup and expose declines towards $1.81 and $1.77.
Currently, the price of XRP is still at a decision point. The bullish reversal signal is active, but only if the key support level continues to hold.
