XRP Sentiment Hits Extreme Fear as Analysts Watch for a Potential Major Reversal
Bearish sentiment toward XRP has reached one of its most extreme levels after a steep 72% correction, but several analysts believe that level of pessimism could be laying the groundwork for a sharp reversal rather than another wave of losses.
Market analyst Crypto Patel noted that XRP funding rates on Binance have fallen deeply into negative territory, indicating that traders are aggressively betting against the asset.
Short interest has also continued to climb, highlighting growing confidence that prices will fall further.
Patel, however, argues that such overwhelming bearish positioning is often a contrarian signal. Historically, when traders become heavily skewed to one side after a major decline, markets have frequently moved in the opposite direction.
He pointed out that the last time XRP funding rates reached similarly bearish extremes, the token surged about 126% as short sellers were forced to close their positions.
As a result, Patel believes periods of maximum fear have often preceded some of XRP's strongest rallies.
According to CoinCodex, XRP is currently trading at $1.09. Furthermore, open interest has fallen to its lowest level in 3 months, suggesting excessive leverage has largely been flushed from the market. Analysts typically view this type of reset as a healthier foundation for a sustained recovery.
EGRAG CRYPTO Predicts XRP Macro Bottom, Eyes Potential Rally Toward $5–$31
Adding to the bullish outlook, market expert EGRAG CRYPTO believes XRP may have already formed its macro bottom. On the two-week chart, he highlighted a rare compression of the 50 EMA, 100 EMA, and 144 WMA, a technical pattern that has historically appeared near major cycle lows before significant upside moves.
EGRAG's base-case scenario envisions XRP rebounding toward the 50 EMA near $1.60 before retracing into the 0.618-0.50 Fibonacci zone, potentially completing a double-bottom pattern ahead of the next impulsive rally.
If history repeats, he projects an initial target between $5 and $6.50, while longer-term Fibonacci extension levels point to more ambitious targets around $9, $15, and even $31. He emphasizes, however, that these are technical projections rather than guaranteed outcomes.
Beyond price action, XRP's fundamentals continue to strengthen. Nearly 40% of all XRP wallets were created in 2024 and 2025, signaling accelerating network adoption and growing participation.
With bearish sentiment at extreme levels, leverage significantly reduced, long-term technical indicators aligning, and on-chain adoption continuing to expand, analysts believe XRP could be approaching a critical inflection point.
Whether this marks the final accumulation phase before the next major breakout remains to be seen, but the coming weeks may prove decisive for the top altcoin’s next move.
