Is XRP Ready for a Breakout or a Deeper Correction? Decoding Wave (B) and Key Support/Resistance Levels

The XRP price narrative in late 2025 is a tapestry of conflicting signals, with technical indicators and Elliott Wave structures painting a complex picture of potential outcomes. As the cryptocurrency navigates a critical juncture, investors must dissect the interplay between corrective patterns, key support/resistance levels, and broader market sentiment to assess whether XRP is poised for a breakout or a deeper correction.

Elliott Wave Analysis: Wave (B) in Focus

According to a report by LiteFinance, XRP is currently in the process of forming Wave (4) following the completion of a bullish Wave (3), with Wave (4) expected to take a corrective or triangular shape. Within this structure, Wave (B)-a critical component of the corrective phase-is unfolding as a double zigzag (W-X-Y). Analysts suggest that Wave (B) has already retraced deeply, with the price forming a descending channel and a death cross (50-day EMA crossing below the 200-day EMA), signaling bearish momentum.

The completion of Wave (B) could trigger a resumption of the bullish Wave (Y), potentially targeting the $2.267 level. A close above $2.22 is considered a technical trigger for the start of Wave (5), which could drive XRP toward the 2.4335–2.6181 range. However, failure to hold key supports, such as $2.17 or $1.82, could extend the corrective phase further, with the $1.25 level-a psychological and historical low from October 2025-emerging as a critical test of market resilience.

Key Support/Resistance Levels and Technical Indicators

Technical analysis highlights a fragile balance between bearish and bullish forces. As of late December 2025, XRP traded in a narrow range of $1.83–$1.90, but a seven-day losing streak in January 2026 pushed the price down to $2.058, a 13% decline. This breakdown below the 50-day EMA at $2.02 and the 200-day EMA at $2.56 underscores the fragility of the current structure.

Key support levels identified by analysts include:
- $2.00: A psychological level and potential short-term floor.
- $1.90: A prior consolidation zone.
- $1.80: A deeper support area.
- $1.25: A critical test of long-term resilience.

Resistance levels at $1.93 and $2.00 remain contested, with a breakout above $2.22 required to validate the resumption of the bullish trend. Meanwhile, the Fear & Greed Index at 27 (Fear) and a 78% bearish reading suggest extreme pessimism, historically a contrarian indicator for potential reversals.

Market Sentiment and Institutional Outlooks

While short-term technicals lean bearish, institutional forecasts remain cautiously optimistic. Standard Chartered projects XRP could reach $8 by 2026, driven by ETF inflows and regulatory clarity. However, these bullish projections hinge on the market overcoming immediate technical hurdles. On the 4-hour timeframe, Elliott Wave analysts note that Wave (4) is forming after a sharp Wave (3), with potential for a bullish move to the 2.4335–2.6181 range if key resistance levels are reclaimed.

The Path Forward: Breakout or Correction?

The coming weeks will be pivotal for XRP. A sustained close above $2.22 could validate the completion of Wave (4) and initiate a Wave (5) rally, aligning with institutional forecasts. Conversely, a breakdown below $1.82 could accelerate a deeper correction toward $1.25, with Fibonacci retracement levels at 50-61.8% acting as potential resistance during any rebound.

Investors must also monitor the death cross formation and the 50-day/200-day EMA crossover, as these indicators historically signal extended bearish momentum. For now, the market remains in a state of indecision, with neutral funding rates and cautious trading volume reflecting uncertainty.

Conclusion

XRP's trajectory in late 2025 hinges on the resolution of its Elliott Wave (B) correction and the integrity of key support/resistance levels. While technical indicators and institutional forecasts present a mixed outlook, the cryptocurrency's ability to reclaim $2.22 or defend $1.82 will be critical decision points. Traders should remain vigilant, balancing short-term bearish signals with the potential for a long-term bullish resumption if Wave (5) materializes.