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Why Are XRP Reserves Dropping on Binance? A Sign of Less Selling Pressure Ahead!
XRP is currently testing a crucial long-term demand zone beneath the $1.90 threshold, as market conditions for altcoins continue to weaken. Recent xrp news highlights the struggles of bulls to maintain key support levels, which is raising concerns about a potential bearish phase in the broader market. This downturn could expose altcoins to more significant price corrections.
Despite the declining price action, on-chain data presents a more intricate narrative. Recent reports indicate a substantial decrease in XRP’s exchange reserves on Binance, even amidst ongoing price corrections. Typically, dwindling exchange balances imply that fewer tokens are available for immediate sale, often resulting in reduced selling pressure rather than widespread distribution. This divergence between the price trend and on-chain supply dynamics becomes increasingly relevant as XRP navigates these critical levels.
Exchange Reserves Hit Multi-Month Low
On-chain metrics reveal a significant shift in XRP’s supply landscape at a pivotal moment for its price. According to the XRP Ledger Exchange Reserve chart, the amount of XRP held on Binance has plummeted to approximately 2.66 billion tokens. This represents the lowest exchange balance since July 2024, indicating a notable contraction in the supply of XRP available for sale.
Historically, declines in exchange reserves are perceived as positive signals. They often indicate that investors are transferring tokens off exchanges into self-custody, thereby diminishing immediate sell-side liquidity. When the trading supply contracts, even modest demand can create a pronounced effect on price, setting the stage for a potential supply-driven upward movement.
Currently, XRP is testing a significant demand zone between $1.80 and $1.90, an area that has previously provided critical support. Momentum indicators further contextualize the situation, with the Relative Strength Index (RSI) reflecting a decline in bearish pressure, though a confirmed reversal remains necessary. The compatibility of declining exchange reserves with strong technical support strengthens the case for potential stabilization or even a rebound in XRP’s price.
Technical Outlook and Market Sentiment
XRP trades near the $1.87 mark on the weekly chart, extending a protracted corrective phase that has diminished much of the bullish momentum previously established. Following a peak in the $3.40-$3.60 range, XRP has consistently formed lower highs and lower lows, signaling a distinct shift toward bearish medium- to long-term trends.
Recent weekly candles indicate sustained selling pressure, characterized by limited downside wicks, suggesting weak dip-buying interest. XRP has lost its key weekly moving averages, with the price now firmly below the faster moving average, which has turned into resistance around the $2.40-$2.60 zone. Although the macro uptrend from previous years technically remains intact, momentum has sharply declined.
The $1.80-$1.90 range stands out as a vital demand zone. This region has historically acted as structural support, and it is now essential for bulls to defend it to avoid a deeper market breakdown. A sustained weekly close below $1.80 would significantly undermine the broader bullish structure and expose XRP to a potential decline towards the $1.50 area or lower.
Conclusion
In summary, while XRP’s technical indicators signal weakening momentum, the concurrent decline in exchange reserves on Binance could indicate less selling pressure. The coming sessions will be critical. Should buyers successfully defend the $1.80 level, the reduced supply may catalyze a recovery. Conversely, a decisive move below this threshold could open the door for further declines in a challenging altcoin market.
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