XRP plunged 4% to $1.61 on January 31 amid crypto's $2B wipeout, with $7M in XRP-specific liquidations — 99% longs, hammering derivatives per @XrpUdate. Price hit $1.698 intraday low after breaching $1.79 support, volume spiked to 3.94B tokens.
This altcoin cascade amplified broader BTC/ETH pressure.
Liquidation Mechanics
Coinglass data shows long/short ratio at 99:1, with $6.93M longs liquidated vs. $70K shorts.
Heatmap peaks align with $1.82 break, flushing 72% correction leverage. Open interest dropped 15%, funding rates turned negative (-0.01%), signaling capitulation reset. XRP's thinner books (vs. BTC) caused outsized volatility.
Chart Analysis Expanded
Analyst @XrpArab's chart shows XRP holding 61.8% Fibonacci retracement from recent 72% correction lows. Blue momentum arrow signals wave (iii) upside continuation, with EMAs aligning bullishly. Key resistance at $1.82-$1.85; hold above $1.80 targets $1.95. Invalidates below $1.74, risking $1.60 demand zone.
This deleveraging follows XRP's January rally from $1.84 to $2.41 early-month, now paused amid macro risk-off. Ripple CEO eyes ATHs in 2026 via ETF inflows ($640M YTD) and reduced exchange supply. Wall Street analysts split: some target $8, others warn $1.24 on breakdowns.
Macro Backdrop and News Catalysts
Ripple Treasury launched post-$1B GTreasury acquisition, enabling firms to manage fiat, stablecoins (RLUSD), and XRP in one dashboard, unlocking 24/7 liquidity via on-chain markets. XRP spot ETFs drew $16.79M inflows Jan 30 (21Shares $8.19M, Bitwise $3.91M), pushing total NAV to $1.19B and historical inflows to $1.18B amid ETF hype.
CEO Garlinghouse predicts crypto ATHs in 2026 via U.S. regs and institutional adoption (BlackRock/Vanguard); bulls target $8 (Standard Chartered) to $12.50 by 2028, bears $1.24-$1.50 on breakdowns. Escrow locked 500M XRP (~$870M) until 2028, cutting circulating supply ~2% and tightening dynamics. SEC case resolved Aug 2025 ($50M penalty), but CLARITY Act delays (to mid-2026?) add uncertainty.
Global liquidations hit $713M/24h, yet XRP OI rebounds 12% post-flush.
Post-liquidation reset clears overheated leverage, setting stage for relief rally. AI models forecast $1.92 average by Jan 31 close, with Binance predictions at $1.65 near-term stabilizing to $1.65-$2.34 in February. Long-term, cycle models see $9-12 if ascending channel intact. RSI oversold supports $1.85 test soon.
