The $1.40 support level for XRP has been breached, and the price decline was swift. This level had been a stronghold for weeks, but once it succumbed to selling pressure, the price dropped rapidly and has yet to recover. The significance of this break lies in the fact that when a support level is breached on high volume, it often flips into resistance, thereby altering how traders approach it. Several factors have contributed to this downturn.
Bitcoin's dominance has surged towards 60%, indicating a shift in capital away from altcoins, including XRP, thereby reducing demand. XRP is also unwinding from a prolonged consolidation phase, with the recent move marking the first decisive break below its support floor.
In terms of price action, XRP plummeted from $1.40 to $1.38, breaking a key support level that had held firm within its range. This move was characterized by a pronounced spike in selling activity rather than a gradual decline.
Currently, the price is consolidating just below $1.40, failing to bounce back after the breakdown. Technically, the structure has undergone a significant shift, with $1.40 transitioning from a support level to a resistance level unless it is reclaimed. The increase in volume during the move confirms genuine selling pressure rather than a drop due to low liquidity. The longer-term consolidation that maintained price stability has begun to resolve on the lower end.
Short-term rebounds have been shallow, suggesting that buyers are not yet entering the market with conviction. For traders, the key level to watch is $1.40. A move above this level would signal a failed breakdown.
The next support level is $1.37, and losing this could pave the way for a decline towards $1.32-$1.28. As long as the price remains below $1.40, any rallies are likely to encounter selling pressure.