Analyst Predicts Strongest XRP Price Rally in History Is Coming, Here's Why

XRP surged more than 15% over the past week, outperforming broader market trends as institutional buying accelerated into new XRP-focused exchange-traded funds (ETFs). The token traded near $2.01 as of January 8, stabilizing above a key short-term support zone after a volatile start to 2026. The rally followed a resolution of the long-running legal dispute between Ripple and the U.S. Securities and Exchange Commission.

Institutional investors added $1.18 billion to XRP ETFs since their launch in late November, making it the second-fastest-growing crypto ETF after Bitcoin. This contrasts sharply with Bitcoin and Ethereum, which saw significant outflows during the same period. The ETF inflows helped absorb supply entering the market, creating a floor for XRP during a period of heightened volatility.

Regulatory clarity emerged as a major catalyst. The SEC's dismissal of its case against Ripple in August 2025 removed a key legal uncertainty that had previously deterred institutional investment. Ripple's legal victory was followed by the launch of spot XRP ETFs by major firms like Bitwise, Grayscale, and Franklin Templeton.

Why Did This Happen?

XRP's recent surge reflects a convergence of favorable market dynamics. The legal settlement cleared a major regulatory hurdle, allowing institutional investors to legally hold and trade XRP in the U.S. This, combined with the launch of new ETFs, triggered a wave of institutional demand. Unlike Bitcoin and Ethereum, which are heavily correlated with global macroeconomic trends, XRP's smaller market cap made it more responsive to ETF inflows.

The ETFs also benefit from structural supply tightness. Exchange-held XRP balances fell by 45% in 2025, reducing the tokens available for trading and increasing the impact of new buying activity. With fewer XRP tokens on exchanges, the price tends to respond more sharply to changes in demand.

How Did Markets React?

Markets responded with a mix of optimism and caution. XRP's price stabilized above key support levels, but buyers remain cautious ahead of a potential breakout. On the daily chart, XRP is still below its 50-day and 200-day moving averages, which continue to act as overhead resistance. Technical indicators remain bearish until the price reclaims $2.22 on a daily close.

Short-term momentum has cooled, as seen on the 30-minute and hourly charts. The RSI moved back to neutral after briefly pushing into overbought territory, indicating that the recent rebound was driven by tactical buyers and short-covering rather than a broader trend. For the rally to continue, XRP needs to hold above $1.98 to $2.00 and push through $2.05 with follow-through.

What Are Analysts Watching Next?

Analysts are closely watching ETF inflows and key resistance levels. Monthly inflows above $300 million are seen as a sign of robust institutional demand. A sustained decline below that level could signal that mandate-driven buying is exhausting and that new catalysts are needed to resume the rally.

The $2.28 resistance level is particularly important. A decisive break above this level would confirm buyer strength and open the path to higher targets. On the downside, $1.85 serves as a critical support level. A sustained break below this level would invalidate the bullish thesis and suggest that distribution is continuing.

Other key factors include BlackRock's potential filing for an XRP ETF and developments in Japan regarding the adoption of Ripple's RLUSD stablecoin. These could influence institutional sentiment and provide additional momentum for XRP's price trajectory in the coming months.

XRP's performance in 2026 will depend on a combination of regulatory clarity, macroeconomic conditions, and institutional demand. With ETF inflows setting records and price consolidating near key levels, the stage is set for a potential breakout—provided key technical and fundamental catalysts align.