XRP Price Bounces 20% Following Trump Dump — A Bull Trap?

XRP (XRP), the cryptocurrency associated with Ripple, has jumped by nearly 20% after dropping to $1.84, its lowest since November 2024. As of April 8, it was trading for as much as $1.93.

The cryptocurrency’s decline mirrored a deepening bearish sentiment across riskier assets. US President Donald Trump’s global tariff announcement on April 2 was the primary catalyst behind the selloff, erasing over $325 billion from the crypto market.

On April 8, XRP staged a modest recovery for two core reasons: the launch of the first-ever XRP ETF—a leveraged 2x fund—and dip-buying opportunities as traders await clues on how Trump’s trade policies will play out.

From a technical analysis standpoint, XRP’s bounce led to lower highs on the daily candlestick chart, suggesting a weakening rebound sentiment among traders. Still, fractal indicators offer a short-term relief outlook.

Let’s examine whether XRP’s ongoing rebound could lead to a broader rally — or is it a bull trap?

XRP Descending Channel Suggests 20% Pump in April

XRP appears poised for a bullish reversal after retesting the lower boundary of a well-defined descending channel.

The daily chart shows XRP locked inside a downward-sloping channel since mid-February. The price recently bounced near the channel’s lower trendline, indicating strong buyer interest at this support level.

Historically, this pattern signals a potential breakout toward the upper boundary, which currently sits near the $2.23 level—aligning with the 0.382 Fibonacci retracement zone from the recent swing high of $3.11 to the swing low of $0.49.

The RSI (Relative Strength Index) has dropped to 33.98, close to oversold territory, and is hovering just above a historical support level at 33.91. This signals weakening bearish momentum and the possibility of a rebound. A bounce in RSI from this zone often precedes a price recovery.

Meanwhile, XRP has broken below its 50-day EMA (red line) but still holds above the 200-day EMA (blue line), currently at $1.94. A successful reclaim of the 50-day EMA could catalyze renewed bullish sentiment.

Conversely, a break below the descending channel’s lower trendline could trigger a classic bearish reversal pattern.

Inverse Cup-and-Handle Pattern Indicates 38% Crash by May

XRP’s daily chart also reveals the formation of an inverse cup-and-handle pattern, a bearish continuation setup that typically signals deeper downside.

XRP has broken below the pattern’s neckline and is now retesting it as resistance — a breakdown stage. Typically, a breakdown below the inverse cup-and-handle neckline leads prices to level at a length equal to the pattern’s maximum height.

The measured breakdown target from this structure points to around $1.15, a level not seen since early December 2024. That is about 38% down from the current price levels.

XRP On-Chain Data Suggests a Prolonged Bear Market

Adding to the growing list of bearish indicators for XRP, on-chain data from Glassnode shows a notable shift in Net Unrealized Profit/Loss (NUPL) sentiment.

Notably, the NUPL metric, which visualizes the emotional state of the market based on unrealized gains or losses, has turned from blue (Euphoria/Greed) to yellow (Optimism/Anxiety).

Historically, this shift has marked the end of bullish phases and the beginning of deeper bearish trends. Similar transitions occurred in early 2018 and late 2021, preceding long-lasting corrections.

This sentiment shift supports the inverse cup-and-handle pattern identified on the XRP/USD daily chart.