XRP's Path to $2.35: Technical and Fundamental Drivers of the Next Leg Higher

The XRP price narrative in early 2025 has been defined by a tug-of-war between bulls and bears, with the asset oscillating within a descending channel bounded by critical support and resistance levels. For investors eyeing a $2.35 price target, the interplay of technical indicators, on-chain dynamics, and potential breakout scenarios offers a compelling case for a short-to-medium-term bullish strategy. While recent fundamental developments remain sparse, the technical underpinnings suggest that XRP could yet test-and potentially surpass-$2.00, with the $2.35 level emerging as a plausible extension of this trajectory.

Technical Foundations: Key Levels and Momentum Shifts

XRP's price action in late 2025 has been anchored by a descending channel, with the $1.85–$1.87 range serving as a pivotal battleground. According to a Coindesk report, XRP recently slipped to $1.85 after breaking through the $1.87 support zone, a level that had previously acted as a consolidation barrier. This breakdown is compounded by increased exchange inflows, signaling distribution pressure as holders shift tokens to selling positions. According to Coindesk data, this shift suggests ongoing distribution activity. However, a tentative double bottom forming near $1.846–$1.848 suggests that buyers may yet defend this area, though repeated stalls at $1.85 reinforce its role as a resistance threshold. As technical analysis indicates, the $1.85 level remains a key resistance point.

The broader technical structure hinges on the $1.87 support level. A successful reclamation of this zone, particularly with a close above $1.90, would signal waning bearish control and could reignite a push toward the $1.95–$2.00 resistance cluster. Crucially, the $2.00 level represents a psychological and historical barrier; a breakout here would likely trigger a rally toward $2.10 and $2.18, supported by bullish MACD momentum. If XRP surges past $2.18, the path to $3.65 and even $4.60–$4.70 becomes conceivable, though such a move would depend on broader market liquidity and macroeconomic conditions. As market analysis shows, this scenario remains contingent on favorable macro conditions.

Momentum indicators further underscore the potential for a reversal. The RSI has entered neutral territory at 64.9, while the MACD line remains above the signal line, suggesting latent bullish momentum. Notably, RSI divergence-where price records lower lows but the RSI sets higher lows-indicates weakening bearish control. These signals, though not yet confirmed by a sustained breakout, hint at a possible shift in sentiment.

On-Chain Dynamics: Accumulation vs. Distribution

On-chain data provides additional nuance to XRP's price action. A report by Altindex highlights a surge in deposits to major exchanges, reflecting a transition from accumulation to selling behavior. This aligns with the technical breakdown at $1.85, as increased exchange inflows often precede price declines. However, sustained outflows-where investors withdraw tokens for long-term storage-suggest that liquidity is being withdrawn from the market, potentially tightening supply during rallies. As on-chain analysis indicates, this dynamic could amplify upside momentum if XRP reclaims key resistance levels, as reduced liquid supply may limit short-term selling pressure.

The Path to $2.35: Breakout Scenarios and Risk Management

For XRP to reach $2.35, a multi-stage breakout is required. First, bulls must reclaim $1.87 and push above $1.90 to reestablish buyer dominance. A successful close above $2.00 would then validate the next phase of the rally, with $2.10 and $2.18 as intermediate targets. If these levels are cleared, the $2.35 mark becomes a logical extension of the upward trend, particularly if broader market conditions remain favorable.

However, the path is not without risk. A failure to hold above $1.85 could trigger a cascade to the $1.77–$1.80 demand zone, invalidating the bullish case. Investors should monitor on-chain flows and RSI divergence for early signs of capitulation or exhaustion. A confirmed breakout above $2.18, coupled with a surge in exchange outflows, would strengthen the case for a $2.35 target.

Conclusion: Strategic Positioning for a Breakout

While the absence of recent fundamental catalysts-such as regulatory clarity or institutional partnerships-leaves XRP's trajectory dependent on technical and on-chain factors, the current setup offers a compelling case for a short-to-medium-term bullish strategy. The key lies in confirming breakouts above $1.87 and $2.00, with momentum indicators and on-chain data serving as critical confirmation tools. For investors willing to tolerate volatility, the $2.35 target represents a high-probability extension of XRP's potential rally, provided that macro conditions and liquidity dynamics align.