XRP's Elliott Wave Setup and the Impending Breakout Below Key Resistance

The XRP price chart in October 2025 is a masterclass in technical complexity, with multiple Elliott Wave interpretations vying for dominance. At first glance, the asset appears to be teetering on the edge of a critical juncture, with bulls and bears locked in a high-stakes battle around the $2.97–$3.10 zone. This range, identified by analysts as a pivotal consolidation area, has become the epicenter of market sentiment and technical analysis, according to The Market Periodical.

The Elliott Wave Dilemma: Wave 3 or Wave 4?

Elliott Wave theory suggests that XRP is navigating a multi-layered structure. Some analysts argue the token is in the early stages of a Wave 3 rally, a phase historically known for explosive upward momentum, according to CoinCentral. This view is bolstered by a recent breakout above $3.23, with Fibonacci extensions pointing to potential targets at $4.12, $5.31, and even $13.59, as BlockNews reports. Conversely, others contend XRP is in Wave 4 of a larger cycle, with a final Wave 5 drop to $1.35–$1.46 expected before a new bullish trend resumes, according to CoinPedia.

The ambiguity is intentional. Elliott Wave analysis thrives on pattern recognition, and XRP's price action has created a "Rorschach test" for traders. For instance, the $2.45 consolidation zone has been interpreted as the end of a corrective Wave 4 by some, while others see it as part of a deeper retracement, The Currency Analytics suggests.

Key Resistance and Support: The $2.97–$3.10 Zone

The immediate focus is on the $2.97–$3.10 range, which has acted as both support and resistance. A confirmed close above $3.10 could trigger a fifth-wave rally toward $5 by late 2025, Brave New Coin projects. However, a breakdown below $2.97 would invalidate the bullish case, potentially pushing XRP into a sideways range or even testing the $2.79 support level, warns The BitJournal.

Technical indicators add nuance. The MACD and RSI suggest bullish momentum, with a breakout above $3.30 potentially confirming a larger rally, as CoinDesk notes. Meanwhile, the $2.31–$2.35 zone is considered an exhaustion zone, where open interest has rebounded to $1.36B as traders rebuild exposure.

Market Sentiment and the Role of Open Interest

Market sentiment is a mixed bag. On one hand, the 34% drawdown in holder positions has pushed XRP near an exhaustion zone, hinting at a potential reversal. On the other, open interest data reveals a cautious optimism: traders are incrementally increasing exposure, but not aggressively. This suggests a "wait-and-see" attitude, with key levels like $3.10 and $2.79 acting as psychological triggers.

The Path Forward: Breakout or Breakdown?

The coming weeks will be critical. If bulls reclaim $3.10, the path to $5 becomes more plausible, with longer-term targets at $6.61 and even $10.00 still on the table. However, a failure to hold above $2.79 would favor a bearish scenario, with a potential drop to $1.35–$1.46.

For investors, the key takeaway is clear: XRP's fate hinges on its ability to break out of the $2.97–$3.10 consolidation zone. This is not just a technical level-it's a psychological battleground. As one analyst put it, "The next move will either validate the bullish case or force a reevaluation of the entire Elliott Wave structure."