Since the peak of 3.1, XRP has been trading in a downward channel. Analysts indicate that the bullish breakout level is at 2.7 and the bearish support level is at 1.6 to determine the price action of the market in 2026.
XRP crashed hard in late 2025. The token had peaked in early October at a high of $3.1 and subsequently failed to maintain critical support levels in Q4.
The asset ended 2025 at 1.84, reflecting an 11.51% annual loss. It marked the Anniversary bearish close in 2022.
However, 2026 brings renewed hope. XRP bounced back to over $2 after three weeks below it. The token increased by 10.77 per cent during the initial three days of January.
Will XRP Break Free or Drop Lower?
TheCryptoBasic on X reported that Chart Nerd studied the current state of XRP. The analyst identified a rejection zone. At the end of October, XRP encountered stiff resistance at around 2.7 to 2.75, leading to the development of a series of losses. The price developed a descending channel formation, and lower highs validated the decline trend during Q4 of the year 2025.
As Chart Nerd observed on X, this zone had reversed into resistance. The building now determines the next significant action of XRP, and it seems that the force is squeezing within the channel.
The channel bottom was found to be at about 1.6 to 1.77. This support has been recently retested with success by XRP. An increase in lower lows now indicates a possible change in trend.
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Bulls Target Channel Breakout at $2.1
The optimistic outlook needs bold action. XRP has to break the resistance level of the upper trendline at 2.1. The token is trading at 2.03. According to TheCryptoBasic on X, everything would be changed with a successful breakout. The $2.7 to 2.75 could then be recaptured by XRP. Chart Nerd thinks this recovery would invert the macro structure into bullish.
The analyst emphasized that momentum is gaining momentum. The channel may narrow, and volatility may increase. Bulls require a constant purchasing force to come out.
The bearish scenario is a contrasting view. XRP may not pass through the higher trendline. A downside would drive prices again to the support of 1.6. This stage has not been tested since April 2025. The analysis by Chart Nerd that was published on X indicates that momentum is intact anyway. In both cases, there is high volatility of prices in the future.
The falling channel dictates the short-term destiny of XRP. The traders monitor the resistance at $2.1. An upward break will be a continuation in a bullish direction to $2.7, whereas failure will indicate a retest of the support level of 1.6. The framework prefers compression to expansion. XRP holders await the next big move.