Key Points:
XRP has confirmed a bearish descending triangle on the daily chart, potentially dropping 18% to $2.40.
The decrease in daily active addresses indicates a reduction in trading activity, cooling demand for XRP.
The cumulative volume delta (CVD) remains negative, suggesting weakened investor demand.
Ripple (XRP) has fallen 23% from its multi-year high of $3.66, with multiple data points indicating its price may further approach $2.40.
Cointelegraph Markets Pro and TradingView data show that Ripple (XRP) has broken below the descending triangle range on the daily level, as illustrated in the chart below.
The descending triangle is a typical bearish pattern characterized by a flat horizontal support line and a downward-sloping upper trend line.
On Tuesday, the price broke below the key chart support line at $2.95, continuing the downward trend with a target of $2.40.
This trend would result in Ripple (XRP) accumulating a decline of 18% from its current position.
As reported by Cointelegraph, altcoins need to reclaim the $3 support level to avoid a deeper pullback to $2.24. The last two instances of the price reclaiming this level occurred in mid-July and early August, triggering rebounds of 25% and 15%, respectively.
XRP's bearish trend is supported by an increasing bearish divergence between its XRP/BTC pair and the relative strength index (RSI).
The chart below shows that the XRP/BTC pair rose between July 10 and August 18, forming higher lows.
However, during the same period, its daily RSI fell from an overbought state of 75 to 43, forming lower lows, as shown in the chart below.
The negative divergence between price decline and RSI rise typically indicates weakness in the current uptrend, prompting traders to take profits at higher levels as investor interest wanes and buyers become exhausted.
The chart also shows that XRP/BTC is above the key support zone between 0.0000245 BTC and 0.0000250 BTC, supported by the 200-day simple moving average.
A break below this area could lead to further declines in the XRP/BTC pair, exacerbated by a further drop in XRP's price.
Compared to the first quarter of 2025 and the period from June to July, network activity on the XRP Ledger has significantly decreased. On-chain data from Glassnode shows that the daily active addresses (DAAs) on the network are now far below the levels seen in March and June.
The ledger recorded 608,000 DAAs on March 19 and 577,134 on June 16, reflecting high user engagement and trading activity. However, there has been a significant decline from the end of June to August, as shown in the chart below.
The daily active addresses are now only about 33,000, with reduced user trading, possibly indicating decreased interest or confidence in XRP's short-term outlook.
Historically, a decline in network activity often foreshadows an impending price stagnation, as lower trading volumes reduce liquidity and buying momentum.
According to CryptoQuant data, the number of transactions has also decreased by 51% from 2.5 million in June to 1.25 million at the time of writing.
Transaction volume and active addresses are widely used to estimate the number of users interacting with the network. They provide valuable insights into overall network activity and user engagement, serving as key indicators of blockchain adoption and interaction with the underlying token.
Therefore, the significant decline in these on-chain metrics could drive XRP's value lower, raising speculation about the token potentially declining further in the short term.
Analyzing the cumulative volume delta (CVD) over 90 days reveals the extent of increased selling activity.
CVD measures the difference in buy and sell volume over a three-month period.
Since July 28, as the Ripple (XRP)/USD pair peaked at $3.66 on July 18, sellers have begun to dominate the market.
Negative CVD (the red bars in the chart) indicates that traders are taking profits, suggesting weakened demand and seller control.
If the CVD remains red, it means sellers are not retreating, which could pave the way for another decline, as seen in historical pullbacks.
Currently, over 91% of Ripple (XRP) remains in profit, and investors may continue to lock in gains, further increasing downward pressure on the price.
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Original: “Ripple (XRP) Price Downtrend Could Continue: Here Are Four Reasons”
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