XRP Price Nears Potential Bottom as Short-Term Holders Capitulate, On-Chain Data Shows

XRP May Be Approaching a Turning Point as Market Shows Signs of Capitulation

XRP, the popular altcoin tied to Ripple Labs, has faced a prolonged downward trajectory, dropping nearly 46% since peaking at $3.40 on January 16. While this sustained correction has left many investors deep in the red—particularly short-term holders—recent on-chain indicators suggest a potential shift may be on the horizon.

Capitulation Signals from Short-Term Holders

One of the most telling metrics currently flashing a signal is the Short-Term Holder Net Unrealized Profit/Loss (STH-NUPL), which tracks whether recent buyers are in profit or loss. As of the latest data, XRP’s STH-NUPL sits at -0.13, its lowest point year-to-date. This indicates that a significant portion of short-term holders—those who have held their tokens for less than 155 days—are now underwater.

Such negative readings are often associated with investor capitulation, when panic or fatigue drives weaker hands to sell at a loss. While unsettling on the surface, this phase historically aligns with market bottoms. When short-term sellers exit, it often clears the way for more resilient investors, potentially setting the stage for a bullish reversal.

RSI Points to Oversold Conditions

Adding to the optimism is XRP’s Relative Strength Index (RSI), which is approaching the key threshold of 30. The RSI measures market momentum and identifies whether an asset is overbought or oversold. An RSI below 30 typically signals seller exhaustion, which could create an entry point for value-driven buyers.

This oversold territory often precedes price recoveries, especially when paired with capitulation data. If buying pressure returns, XRP could benefit from renewed investor interest at discounted levels.

Technical Picture Still Bearish—For Now

Despite these encouraging signals, XRP remains technically bearish on the daily chart. The token continues to trade within a descending parallel channel—a pattern that has persisted since January. This formation, marked by lower highs and lower lows, suggests that the downtrend remains intact for now.

If bearish momentum continues, XRP could slide toward support near $1.61. However, if buying volume picks up as oversold conditions deepen, analysts see potential for a bounce toward $1.89, a key resistance level.