#CryptoMarketWatch

XRP Struggling Below $2: Loss-Making Increases on the Network.

Individual XRP investors are selling at a loss. Short-term fear prevails.

Institutional inflows support XRP's recovery despite the downtrend.

XRP continues to trade under pressure as weakness in the overall cryptocurrency market negatively impacts investor sentiment. The token remains in a short-term downtrend: This trend is supported by both the macroeconomic bearish sentiment and the ongoing investor skepticism.

Nevertheless, Ripple's operational progress continues. This could pave the way for XRP's price to stabilize and recover in the long term.

If the transition to the XRP Ledger takes place, it will be a very significant development. Integration with XRPL will increase on-chain use case, transaction demand, and network activity. With this development, Ripple can benefit from the growth in tokenized and cross-border payment solutions; and indirectly, it will support the fundamental outlook of XRP.

XRP Holders Are Selling

Despite all these steps, XRP investors remain cautious. On-chain data shows that net profit/loss has turned negative in recent sessions. Investors are selling XRP below their purchase prices. This behavior generally indicates that concerns about further declines are outweighing hopes for a short-term recovery.

It is clear that this selling pressure is creating a sense of hesitation among individual participants. This ongoing selling pressure can prevent rapid changes in price momentum, even if fundamentals improve. Without restoring investor confidence, XRP may struggle to reflect the progress within Ripple's ecosystem in its price in the short term.

Large Wallets Still Have a Bullish View on XRP

Institutional behavior presents a different picture. In the week ending January 16th, there was a total institutional inflow of $69.5 million into XRP. The total monthly inflow reached $108.1 million, despite XRP still being in a downtrend. These consistent inflows indicate that large investors are maintaining their long-term commitment.

Institutional purchases often precede trend changes: these players tend to accumulate when pessimism prevails in the market. These sustained inflows support liquidity and limit downside risks. This divergence between the cautious stance of individual investors and the confidence of institutions could also contribute to XRP establishing a solid foundation for recovery.

The XRP price was trading near $1.96, below a downtrend line that has been observed for over two weeks. While technical pressure persists, fundamental improvement and institutional demand are increasing the likelihood of a breakout. A breakout from this downtrend could bring about a significant shift in short-term momentum.

A confirmed move above the downtrend line could bring XRP above the psychological $2.00 threshold. If the $2.03 level is then surpassed, a rise towards $2.10 would be possible. If momentum remains strong, a recovery towards $2.35 is also a possibility in the near term.

If XRP fails to regain $2.00, the bullish scenario will lose validity. A rejection from this level could restart profit-taking. In such a case, the XRP price could retreat below $1.86, thus invalidating the bullish thesis and deepening the current downtrend.