A 40% collapse of XRP could not shake its strongest holders – is $1.70 even possible?

The price of XRP has fallen almost 40% since January 5th, falling from $2.35 to around $1.40. Normally moves of this magnitude lead to panic selling and cause long-term damage to the market structure, but this time, something completely different happened.

Instead of accelerating the decline, one group of winners remained calm, while another group, less active, quietly went away. At the same time, leverage levels were balanced and institutional flows were positive. Together, these signals suggest that the collapse of XRP may be strengthening rather than weakening its fundamentals.

Speculators Collapse – Eliminating the biggest source of selling pressure

The exit of speculators is one of the most important changes that happened during … XRP lowThis is shown by the HODL Waves indicator, which divides holders into time groups. These are short-term traders who hold the currency for a day to a week and often sell quickly during periods of volatility.

As of February 8, these short holders control 2.29% of the total supply of XRP. By February 26, this number had fallen sharply to only 0.579%, which represents a decrease of 74.7% in the share of speculative supply in less than three weeks, while the price had fallen.

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This liquidation is important because speculators often create sustained selling pressure during rebounds, and their exit eliminates unstable supply, allowing prices to stabilize. Basically, the weak hands are already gone, and this reduces the risk of panic collapse during future pullbacks.

But removing the weak holders alone does not create power, and the most important question is whether the strong holders will also remain.

Long-term investors hold their positions, even as XRP price loses 40%

During the XRP price collapse, long-term holders behaved very differently.

The Hodler Net Position Change indicator monitors whether investors who have held the currency for at least 155 days buy or sell within a 30-day period. They are considered some of the most savvy participants because they often accumulate during weak markets.

On January 5, when XRP was trading near $2.35, long-term holders added about 47.3 million XRP on a moving monthly basis. By February 26, after his XRP had fallen to around $1.40 (a 40% drop), his net position change had increased significantly to around 145.45 million XRP, representing a 200% increase.

This means that the largest and most patient investors increased their exposure as prices collapsed, as opposed to panic behavior.

Most importantly since mid-February, they have maintained their holdings unchanged even when the price of XRP has fluctuated between $1.21 and $1.52. They do not reduce their exposure during volatility. This stability indicates a strong message. It suggests that investors with the strongest conviction do not see the collapse as a reason to exit, but appear to be positioning themselves for a future recovery.

This contributes to creating a solid base of awardees. However, price stability also depends heavily on the position of derivatives.

XRP’s balanced leverage mitigates the biggest crash risk

Accelerated crypto collapses are often caused by a significant imbalance in leverage. When a large number of traders take the same position, forced liquidations amplify price movements.

Currently showing ethereum This risk is clear. In the ETH/USDT perpetual contracts on Binance, the total long leverage is about $976 million compared to $576 million in short contracts. This creates severe liquidation risks if the price falls.

The XRP situation looks completely different.

On Binance, near-perpetual XRP contracts show $74.93 million in long leverage and $69.14 million in short leverage. This is an almost perfect balance over the same period of time compared to ETH.

This balance is very important. It means that XRP does not have a large pool of over-leveraged buyers that could be liquidated during the decline. At the same time, it also avoids crowded shopping centers that can destabilize prices.

Leverage balance creates a healthier structure. It allows the price to move more based on real demand rather than forced liquidations. This healthy situation is also reflected in the institutional flows and the technical structure.

Institutional flows and XRP price structure are now paving the way towards $1.70

While many major crypto assets saw weak demand for ETFs in February, XRP investment products continued to attract steady flows. This shows that institutional participation did not collapse during the decline of xrp. No major net outflow week was recorded in XRP investment products

Institutional capital inflow was considered important because it represents long-term capital. Unlike speculative traders, institutions typically do not react to short-term fluctuations. The consistency of their participation helps to stabilize the markets during uncertain periods.

Combined with strong XRP holder behavior and a leveraged balance, this contributed to strengthening the basis for XRP’s recovery. These structural improvements began in line with a major technical setup.

Shown in the 8-hour chart, Looks like xrp is forming Cup and handle model. Consider this a bullish continuation pattern that often appears before bullish breakouts. The handle appeared after XRP corrected about 7% from its February 25 high, forming a consolidation zone.

This model now identifies the next major levels. If xrp maintains its level above $1.38, the bullish pattern remains intact. Falling below this level will weaken the momentum.

A drop below $1.31 completely invalidated the bullish pattern. On the upside, xrp must first break $1.42 to confirm a handle breakout. The most important level to explore was $1.52, which is near the cup neck and handle pattern.

If it is hacked XRP Level of $1.52, technical forecasts indicate about $1.71 (area of ​​$1.70). In stronger breakout scenarios, the move could extend towards $1.86 depending on the strength of the breakout and where the neckline is crossed.

Currently, the collapse movement in XRP has caused something unexpected. It could have made the asset structurally stronger rather than weakened.