XRP gradually loses link with Bitcoin – A market advancement or a warning signal?

After a period of maintaining an impressive bullish trend, XRP is currently facing signs of weakening growth momentum. This altcoin, which once drew attention from investors, is now stagnating, indicating that the bullish trend may have somewhat lost its appeal.

However, despite the short-term correction pressure, many experts remain optimistic that the stable demand from investors can act as a cushion, helping XRP limit deep declines.

XRP loses support from Bitcoin

The correlation between XRP and Bitcoin has sharply decreased, currently standing at 0.4 — the lowest level since February of this year. This is a noteworthy development, especially in the context of Bitcoin having just established a new price peak.

History shows that whenever the correlation between these two assets weakens, XRP often faces strong selling pressure, sometimes dropping by as much as 22%. However, after such deep corrections, this altcoin usually tends to recover.

What worries investors is that this decrease in correlation is occurring while Bitcoin is experiencing significant growth — something that should have provided a ripple effect to altcoins like XRP. However, the fact that XRP has not been able to “catch up” with Bitcoin’s rise raises the question: Is XRP’s appeal in the eyes of investors diminishing?

If this divergence continues, XRP may find it difficult to take advantage of the overall bullish wave, thus facing more challenges in the near future.

The correlation of XRP with Bitcoin | Source: TradingViewHowever, beneath those negative signals lies a positive factor worth noting: the holding behavior of XRP investors is showing signs of becoming more stable. On-chain data indicates that the amount of XRP that has not been moved in the past 3–6 months is steadily increasing this month — a sign that short-term investors are transitioning into mid-term holders.

This is seen as an indication of increasing confidence in the long-term value of XRP. The rise in “sleeping” supply suggests a bullish trend rather than profit-taking, thus forming a solid buffer that helps XRP withstand short-term fluctuations.

Source: GlassnodeIn the contradictory picture between declining correlation and active accumulation behavior, XRP is entering a phase where investor confidence will play a key role in shaping the upcoming trend.

XRP price has recovered again

Currently, XRP is trading around $2.26, having just breached the important support level at $2.27 in the past 24 hours. Over the last two weeks, the price has continuously declined due to failure to break through the strong resistance area at $2.58.

Daily chart of XRP/USDT | Source: TradingViewThis development reflects a weakening signal in the bullish trend, while also indicating that selling pressure is dominating, opening up the risk of a deeper correction in the near future.

If the bearish trend continues, XRP may retreat to test the next support zone at $2.12 – a significant drop that could make market sentiment more negative and trigger a strong wave of selling.

However, a positive scenario is still possible if the buying force returns and holds the $2.27 mark. At that time, XRP has a chance to bounce back up, heading towards the $2.38 mark, and may even retest the key resistance at $2.58. Maintaining the price above this support level will help neutralize the current negative trend and create a foundation for a new rally.

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