XRP Paints 50% Crash Setup As Bulls Remain in Denial Mode

XRP (XRP) is signaling declines in the coming weeks after surging by over 50% from its April lows of around $1.61. Its bearish outlook comes from the combination of a technical and onchain metric.

Let’s examine these factors in detail.

XRP’s Inverse Cup-and-Handle Setup Hints at 50% Crash

XRP has formed an inverse cup-and-handle pattern, a bearish technical formation indicating a possible substantial price drop.

This pattern is characterized by a rounded top followed by a consolidation phase, typically leading to a breakdown below key support levels. Currently, XRP is testing the neckline support around $2.00.

A decisive break below this level could validate the pattern, potentially targeting a decline to approximately $1.24, aligning with the 200-day exponential moving average (EMA) at $1.28.

That amounts to nearly 50% correction from current price levels.

NUPL Metric Enters ‘Denial’ Phase, Indicating Potential Downtrend

The Net Unrealized Profit/Loss (NUPL) metric compares the current market value of held XRP to the price at which it was last moved onchain, offering insight into whether investors are in profit or loss.

When NUPL enters the “denial” phase — typically between values of 0.5 and 0.75 — most holders are still in profit, but sentiment begins to weaken as price momentum stalls.

In this phase, investors often refuse to acknowledge a possible top, holding onto positions despite warning signs. This emotional state can lead to poor decision-making, where holders delay exiting positions even as the price starts falling.

Historically, XRP’s denial phase has marked the early stages of major declines, most notably before the sharp crashes in 2018 and 2021. If the pattern holds, XRP’s current denial phase may signal that the recent rally is over and a deeper correction is underway.

On the fundamental front, Judge Torres recently denied Ripple and the SEC’s joint motion to settle, requiring a procedurally correct filing before any relief can be considered. This may further pressure XRP in the short term.