XRP posted its lowest weekly close in nearly two years on Sunday, breaking through the $1.04 support level that had remained intact every week since November 2024. The breach of this key technical floor has shifted market focus to the $1 psychological barrier, which now serves as the primary line of defense for the asset. A clean weekly loss of the $1 level opens the path for a decline toward $0.75, identified as the next meaningful support on the weekly chart. Conversely, holding above $1 could enable a relief bounce toward $1.06 resistance.

The price action coincides with regulatory headwinds affecting the broader crypto narrative. The Clarity Act missed its Senate vote before the recent recess, delaying one of XRP’s key potential catalysts. Senate Majority Leader John Thune filed cloture on the motion to proceed, with a vote rescheduled for September 15 when the Senate returns. However, Grayscale noted that the odds of the Clarity Act’s passage have fallen significantly, warning that the US risks losing crypto investment and developers to other jurisdictions.

Market sentiment reflects this uncertainty. Polymarket currently assigns a 65% probability to XRP falling below $1.00 before the end of the month. As of Monday, XRP traded at $1.027, bouncing at the apex of a broken triangle pattern but lacking volume conviction behind the move. Technical indicators remain bearish, with the Parabolic SAR sitting at $1.11 and all four Exponential Moving Averages (EMAs) stacked overhead as resistance.

Despite the bearish technical setup, some analysts point to emerging bullish signals. Ali Martinez outlined a five-part bull case based on two key data points: a monthly Tom DeMark Sequential buy signal and significant whale accumulation. Santiment data cited by Martinez shows that whale wallets added more than 380 million XRP over the past week, suggesting conviction near current prices. Martinez identifies $1.06 as the critical resistance level to flip, noting that roughly 3 billion XRP changed hands around this price on-chain.

What the Numbers Show

The divergence between short-term technical weakness and long-term accumulation patterns presents a complex trading environment. While the immediate chart structure is bearish—with overhead EMAs and a broken support shelf—the influx of more than 380 million XRP into whale wallets suggests institutional or large-holder interest is building at these lower levels. This accumulation mirrors the setup preceding a 1,074% rally following an April 2020 DeMark signal, though such historical parallels carry no guarantee of future performance. The immediate battle remains at $1; a failure here validates the path to $0.75, while a hold allows for a test of the $1.06 resistance zone.

XRP is trading at $1.0424, hovering just above its year-to-date low of $1.007 and the critical psychological support level of $1.00. The token faces downward pressure as Exchange-Traded Fund (ETF) inflows decelerate sharply and Ripple USD (RLUSD) stablecoin adoption metrics deteriorate. Technical indicators suggest that a daily or weekly close below $1 could trigger a measured move toward $0.85 to $0.88, representing a potential decline of 15% to 17% from current levels.

ETF Inflows Decelerate Sharply

Institutional interest in XRP ETFs has waned significantly. According to SoSoValue, XRP ETF inflows totaled just $1 million this week, a steep drop from the $14 million recorded the previous week. This weekly figure is part of a broader monthly trend: total inflows for July stood at $27 million, down from $59 million in June and $131 million in May.

The contrast with other major crypto assets is stark. Spot Bitcoin ETFs added over $800 million in inflows during the same week, while Ethereum funds attracted $244 million. Among individual XRP ETF providers, Bitwise’s XRP fund holds $303 million in assets, followed by Franklin’s XRPZ with $245 million and Canary’s XRPC with $237 million.

RLUSD Stablecoin Loses User Base

Ripple Labs’ stablecoin, RLUSD, is also showing signs of weakening momentum. Its market capitalization has declined from $1.81 billion in June to $1.58 billion. While Artemis data indicates an increase in trading volume over the past 30 days, the number of unique holders has dropped by 8.5% to 26,200. This divergence suggests that while transaction activity has risen, the underlying user base is shrinking, potentially indicating speculative trading rather than organic adoption.

These developments follow the launch of version 3.3.0 of the XRP Ledger, which introduced features such as confidential transfers, batch transactions, and sponsored fees. Despite these technical upgrades, market sentiment remains cautious.

Derivatives Show Crowded Long Positioning

Derivatives markets reveal a heavily skewed positioning among traders who remain bullish despite falling prices. Volume jumped 16.52% to $2.52 billion on Friday as traders clustered around the $1 level. Long/short ratios remain elevated: 3.0 on Binance, 3.7 on OKX, and 3.57 among top traders.

Long liquidations hit $11.75 million in 24 hours compared to just $310,000 in short liquidations, indicating that bulls are absorbing significant losses while shorts remain largely untouched. Open interest dipped slightly to $2.34 billion as some traders closed positions. With most traders positioned long into a falling price at a critical chart level, a break below $1.00 could trigger a wave of selling that accelerates the decline beyond standard technical targets.

What the Numbers Show

The combination of slowing ETF inflows and shrinking RLUSD holder base suggests a broader loss of confidence among both institutional and retail participants. While trading volume in RLUSD has increased, the decline in holders points to potential churn rather than growth. Simultaneously, the heavy long positioning in derivatives creates a fragile market structure; if the $1 support fails, the resulting liquidations could exacerbate the downside move toward the $0.85–$0.88 target zone.