XRP Dips 14% As First Sell Wave of 2026 Hits - Yet The Trends Holds

XRP declined 14% to around $2.10 on January 9, 2026, marking the first major sell-off of the year after a sharp rejection from a descending trendline. The price had been trading near $2.40 earlier in the week before experiencing a pullback.

The drop followed a $40.8 million net outflow from U.S. spot XRP ETFs on January 7, ending a 54-day streak of consistent inflows. This was the first meaningful reversal in institutional positioning since the start of 2026.

WisdomTree, a major asset manager, also withdrew its XRP ETF application with the SEC, citing strategic reasons. Despite this move, XRP ETF demand remains strong, with total inflows exceeding $1.25 billion as of early January 2026.

Why Did This Sell-Off Happen?

The first major outflow occurred as institutional participants locked in gains following an extended inflow run. This move reflects selective positioning rather than a wholesale exit from XRP.

WisdomTree’s withdrawal from the XRP ETF application has raised questions about market saturation and timing. The firm cited strategic considerations but did not specify the exact reason for the decision.

The outflow coincided with a broader market correction, as XRP failed to break above key resistance levels defined by a descending trendline and the 200-day EMA. The price remains below these critical levels, signaling continued pressure on the bulls.

How Did Markets Respond?

The drop in price was followed by a rebound on January 8 as ETFs saw $8.72 million in net inflows. This indicates that institutional buyers are still active, but with more selective positioning.

Retail and institutional investors alike are monitoring key support levels near $2.00 and $2.40. A break below $2.00 would expose further downside, while a sustained move above $2.40 would shift momentum to the bulls.

XRP’s market cap dipped to around $130 billion as a result of the price decline, temporarily widening the gap with BNB. This move reflects a broader market shift in asset rankings and investor sentiment.

What Are Analysts Watching Next?

Analysts are closely watching whether XRP can hold above key support levels such as $2.00 and $2.05. A sustained breakdown below these levels would signal a deeper correction, potentially extending the range back to $1.80–$1.90.

On the upside, a breakout above $2.40 could open the door for a move toward $2.75. However, short-term volatility and overbought conditions remain a risk as the RSI hovers near 67.

Institutional demand remains a key factor in XRP’s near-term trajectory. While ETF inflows have shown some cyclicality, the overall trend remains bullish, with ETF assets now standing at over $1.65 billion.

Investors are also turning to yield strategies such as SolStaking to manage capital during the consolidation phase. These strategies allow investors to generate returns without relying on price appreciation alone.

As the market consolidates, the focus is shifting from short-term speculation to long-term fundamentals. Ripple's expansion in cross-border payments and protocol upgrades to the XRPL are expected to drive XRP's broader utility and adoption.