XRP Faces Critical Test as Bearish Divergence Signals $2 Retest—What Can Bulls Do?

After reaching this peak, XRP has experienced significant volatility, currently trading around $2.50. A bearish divergence forming on both daily and weekly charts suggests a potential pullback, with analysts warning of a possible retest of the $2 support level.

The XRP price already dived below the $2 critical support on February 3. Source: Xavier Sterling via X

The cryptocurrency recorded a high of $3.03 in January, marking its highest monthly close in years. However, a sharp correction followed, dragging the price down to $1.78 before bouncing back. Now, with technical indicators pointing toward a loss of bullish momentum, XRP could be at risk of another downturn unless buyers step in at critical levels. The 2025 price predictions for Ripple’s XRP had been bullish, but now the tide is turning.

Among the main points of concern for XRP investors is the formation of a bearish divergence—when the price is making higher highs while the RSI forms lower highs, which presumes weakened buying pressure and a high chance of a price correction.

XRP’s bearish divergence setup puts the price at risk of breaking below the $2 support. Source: TheTraderEdge on TradingView

Meanwhile, the overbought levels have been reading lower on both the daily and weekly charts, which indicated a probably weakening rally. Divergences set up ground for pullbacks to go as high as 23% down from the current prices, according to some analysts’ predictions from a historical perspective. The continuation of bearish trends should see XRP revisit the $2 mark—an area that proved to be one of the strong support zones for the digital asset.

For XRP to invalidate the bearish outlook, bulls need to push the price above $2.90 on the daily chart. This level previously acted as resistance in December before being flipped into support during XRP’s rally past $3. A recovery of this area by the buyers would regain confidence in the market and continue the uptrend.

The XRP price must hold above the $2.90 level to revive the bullish momentum. Source: WhoIsCaerus on TradingView

Besides, according to on-chain data, $2.90 is an important price level since most of the heavy trading activity happened at this level across exchanges like Binance and Coinbase. If the price stays below this mark, the chances of further downside increase.

The broader crypto market has also been experiencing turbulence, with macroeconomic factors contributing to uncertainty. XRP’s recent price movements indicate that traders are cautious, waiting for clearer signals before taking decisive action.

Ripple was trading above the $2.50 support, up 0.51% in the last 24 hours as of press time. Source: XRP Liquid Index (XRPLX) via Brave New Coin

If XRP fails to reclaim $2.90, the bearish divergence could play out fully, leading to another correction. In such a scenario, the $2 level will be a crucial support zone, and failure to hold above it could open the door for an extended decline towards the $1.78 region. However, if bulls regain control, XRP could stabilize and attempt another push toward its previous highs.

With the current market dynamics, traders should closely monitor key price levels and RSI trends to gauge XRP’s next move. While the bullish structure has not been entirely invalidated, time is running out for buyers to step in and prevent a deeper pullback.

In the medium term, Spot XRP ETFs and American Digital Asset Reserves may prove bullish catalysts for XRP, but we have to get there first. Hold on.