Key takeaways:
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XRP’s failure to hold $3 points to a continued downside risk to $2.40-$2.00.
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Whales continue to sell XRP.
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Declining daily active addresses signal reduced transaction activity and liquidity.
XRP (XRP) price flashes warning signs below $3 as bearish technical patterns emerge on its daily chart, coinciding with selling by whales and declining network activity.
XRP price charts hint at more downside
XRP price has been forming a descending triangle pattern on its daily chart since its rally to $3.66 multi-year highs, characterized by a flat support level and a downward-sloping resistance line.
The recent breakout above the triangle’s upper trendline was a fakeout as bulls struggled to keep the price above $3, signaling a lack of strength.
Related: XRP reserves rose by 1.2B in a day: Is it accumulation or signs of a sell-off?
Therefore, failure to reclaim $3 soon, where the 50-day SMA sits, could sink the XRP/USDT pair to the next support at $2.70.
Further down, the following levels to watch are the 200-day SMA at $2.50 and, later, the downside target of the triangle at around $2.06, down 31% from current price levels.
Moreover, XRP’s descending triangle analysis is accompanied by a bear flag on the same time frame, which warns of a possible decline to as low as $2.40, after the support at $3 was lost.
As Cointelegraph reported, if the price reclaims $3, buyers will then try to resume the uptrend by pushing the XRP above the flag’s upper boundary at $3.20. If they do that, the XRP price could rally to $3.40 and subsequently to $3.66.
Whales offload XRP at $3
Onchain data shows that large investors booked profits on the latest rally to $3.10.
The Supply Distribution metric shows a sharp drop in the supply held by entities with a 1–10 million balance. These addresses now own 6.79 billion XRP supply, marking a six-week low.
The chart below shows that these whales have offloaded over 160 million XRP tokens worth over $476 million at current prices in the last two weeks.
This underscores that the big investors are likely anticipating lower prices in the near future despite impending spot ETF approvals and Fed rate cuts.
Meanwhile, a significant rise in XRP exchange reserves adds to the headwinds, data from Glassnode reveals.
The chart below shows that the XRP balance on exchanges increased by 665 million tokens to 3.94 billion on Monday from 3.3 billion on Aug. 27, increasing the supply available for selling.
Declining XRP Ledger network activity
The XRP Ledger has seen a significant drop in network activity over the last two months. Onchain data from CryptoQuant shows that the daily active addresses (DAAs) are far below the July 18 peak of 50,482 DAAs.
With only around 21,000 daily active addresses at the time of writing, user transactions have declined significantly, possibly signaling reduced interest or a lack of confidence in XRP’s near-term outlook.
New addresses have also dropped from a 2025 high of 11,000 daily to the current count of 4,300 over the same period, suggesting declining network adoption and user engagement.
Historically, declines in network activity typically signal upcoming price stagnation or drops, as lower transaction volume reduces liquidity and buying momentum.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.