XRP Investors Show Signs of Fatigue Amid 15% Monthly Drop, Are Bulls Preparing a Comeback?

XRP’s price action in February has reflected a market caught between fading momentum and cautious optimism. After weeks of steady decline, the token is trading near $1.37, down roughly 15% for the month, while broader crypto sentiment remains sensitive to macroeconomic signals and shifting liquidity conditions.

Despite a weakening short-term structure, several market indicators suggest traders are closely watching for early signs of a potential recovery rather than abandoning the asset altogether.

Market Fatigue Emerges as Leverage and Momentum Decline

Recent derivatives data points to growing investor exhaustion. According to analytics, XRP’s Estimated Leverage Ratio has fallen to around 0.16, indicating that heavily leveraged traders have largely exited. This reduction in speculative positioning has lowered the risk of sudden liquidation-driven volatility.

Price structure supports that cautious mood. XRP continues to trade below its 50-day and 200-day exponential moving averages, signaling persistent bearish pressure. Data tracked on CoinGlass shows declining open interest alongside calmer funding rates, suggesting fewer aggressive bets from short-term traders.

Meanwhile, whale activity has added uncertainty. More than 31 million XRP were recently transferred to Binance, raising concerns about potential sell pressure if those holdings reach order books.

Three XRP Pre-Rally Signals Reappear

Despite the slowdown, analysts note similarities with conditions that preceded XRP’s late-2024 rally, when prices surged following Donald Trump’s election victory. Three indicators have resurfaced: rising exchange inflows, tightening USD liquidity in automated market-making pools, and shrinking XRP liquidity.

Liquidity compression historically reduces available supply during periods of renewed demand, often amplifying price movement. Current USD liquidity levels have dropped significantly from late-2025 highs, while XRP liquidity has fallen below thresholds seen before the previous breakout.

Similarly, spot XRP exchange-traded funds recorded $3.04 million in net inflows on February 24, pushing cumulative deposits above $1.23 billion, a sign that institutional participation remains steady even during price weakness.

Macroeconomic factors continue to weigh on sentiment. Stronger-than-expected U.S. consumer confidence data reduced expectations of near-term Federal Reserve interest rate cuts. The CME FedWatch Tool showed June rate-cut odds slipping below 50%, limiting risk appetite across digital assets.

According to CoinMarketCap’s pricing aggregates, XRP is consolidating above the $1.30 support zone, while resistance levels sit at $1.50, $1.60, and $2.00. Analysts suggest a sustained move above $1.60 would be required to shift momentum decisively in favor of buyers.

XRP appears to be transitioning from a leverage-driven market to one driven by genuine spot demand. Whether that shift becomes the foundation for a recovery or an extended consolidation phase will likely depend on broader crypto market strength and renewed buying interest.

Cover image from ChatGPT, XRPUSD chart on Tradingview