XRP's Price Action Pattern Signals Potential Downside Risk

The current price action pattern in XRP tells a compelling story for long-term investors tracking the cryptocurrency’s cyclical behavior. Analyzing how this digital asset has interacted with the 50-week simple moving average (SMA) across multiple market cycles reveals a persistent technical framework that warrants close attention. Crypto analyst Steph Is Crypto recently highlighted this pattern, demonstrating how price movements relative to this key technical indicator have reliably predicted market direction shifts over more than a decade.

Understanding the 50-Week SMA Pattern Across Multiple Cycles

The historical pattern is striking. When XRP’s price breaks below the 50-week SMA, the long-term trend typically transforms bearish, and the moving average itself becomes a resistance level that proves difficult to reclaim. This phenomenon has repeated across distinct market cycles with remarkable consistency.

Examining the data: In 2015, XRP experienced a devastating 75.03% decline from its local high. The 2018 cycle delivered even steeper losses, with the token retreating 85.77% after dropping below the SMA threshold. The 2022 downturn followed the same playbook, with XRP sliding 68.61%. These figures aren’t anomalies—they represent a documented pattern spanning more than a decade, suggesting that investors who recognize this technical signal gain predictive insight into potential market movements.

The pattern indicates that once price fails to reclaim the 50-week SMA as support, subsequent declines follow almost mechanically. Each retest of the moving average from below has historically ended in failure, setting the stage for extended downtrends.

Current Price Action and Technical Resistance Levels

XRP is currently trading at $1.73 as of late January 2026, following a sharp recent pullback from over $2 with a 24-hour decline of 4.15%. This price action comes after the token briefly approached the 50-week SMA during its resurgence earlier in the month but failed to establish support above this critical level.

The current situation mirrors the conditions that have preceded major declines in previous cycles. The inability to break through and hold the 50-week SMA suggests renewed selling pressure. Traders watching the price action pattern are interpreting this failed retest as a potential warning signal. The white line representing this moving average on technical charts shows multiple rejection attempts, a visual representation of how resistance has functioned across successive market cycles.

At $1.73, XRP sits at a critical technical juncture where price action will likely determine whether the downtrend continues or stabilizes. This level has become the key battleground between bullish and bearish forces.

Historical Support Levels and Downside Projection

Using historical precedent as a framework, the current price action pattern suggests several risk scenarios. If XRP follows the trajectory of previous cycles, declines ranging from 68% to 85% would place the token in a target range between $0.59 and $0.27. The $0.59 level represents a price zone not seen since late 2024, while $0.27 marks territory the token hasn’t visited since early 2021.

These projections are not guaranteed forecasts but rather guideposts derived from historical pattern repetition. The pattern has proven reliable enough to warrant serious consideration from risk-conscious investors. Should price action continue deteriorating and the token fails to mount a decisive recovery attempt at current levels, the historical precedent becomes increasingly relevant.

The decisive factor remains price action around the 50-week SMA itself. Whether XRP can quickly reclaim and establish support above this moving average will determine whether the bearish pattern repeats or breaks down. The pattern suggests that delayed recovery attempts typically result in extended downside, making the next few weeks potentially crucial for reversing this technical narrative.