XRP price declines 7% to $2.33 as investors take profits. A dip below $2.20 could lead to additional downside risks.

XRP price dropped to $2.30 on Sunday, January 5, marking a 7% decline within 24 hours. Recent market data indicates significant sell-side pressure on XRP. Could XRP be facing the potential for double-digit losses in the coming week?

XRP Price Retraces 7% as Profit-Taking Begins

XRP price action has experienced downward volatility in the last 24 hours, after a remarkable start to 2025. As the global crypto market rally entered its 5th day, investors began to reshuffle capital across the markets, with the likes of XRP and Shiba Inu (SHIB) witnessing bearish tailwinds.

The TradingView chart above illustrates how XRP prices climbed 25% between December 30 and January 4. But after a 5-day winning streak, early profit-taking signals have emerged as XRP price retraced 7% from $2.50 to $2.33 in the last 24 hours.

With the broader crypto market sentiment still largely positive, recent declines in XRP transaction volumes suggest traders could be rotating gains towards other assets.

CryptoQuant Data Indicates Increasing Sell-Side Pressure

Failure to breach the $2.50 resistance on January 4 has dampened bullish momentum within the XRP markets over the last 24 hours. However, derivatives markets data show active holders ramped up sell-side pressure since January 2.

Indicatively, CryptoQuant’s Taker Buy/Sell ratio tracks and compares the volume of buy orders to sell orders executed at current market rates. Taker Buy/Sell ratio values below 1 signal bearish dominance, where sellers exiting at current prices outpace willing buyers.

Source: CryptoQuant

The chart above shows that XRP Taker Buy/Sell ratio fell as low as 0.93 on Sunday, January 5, signaling that sell order volumes have outpaced demand in each of the 3 previous trading days. This evidently set the stage for the 7% price dip experienced in the last 24 hours.

If this shortfall in market demand persists relative to supply, XRP prices could face additional downside risks in the week ahead.

XRP Price Outlook: Bulls May Rebound at the $2.20 Support Zone

XRP’s recent 7% price drop has been fueled by a swift wave of profit-taking, with the Taker Buy/Sell ratio falling to 0.93 as of January 5. This reflects a consistent dominance of sell orders over buy orders over the past three trading sessions, amplifying downward pressure.

If this supply-demand imbalance continues, XRP may experience further losses in the near term.

Trading volumes have been steadily declining, indicating subdued activity from both buyers and sellers.

The Relative Strength Index (RSI) is moving downward at 53.69, pointing to additional downside potential before nearing oversold levels.

For short-term XRP price predictions, immediate support is seen at $2.27, coinciding with the lower Bollinger Band. A breakdown below this critical support level could push the price lower toward $1.85.

On the upside, the recent high at $2.50, which corresponds to the middle Bollinger Band, serves as immediate resistance.

A steady recovery above this level could open the door for XRP to reclaim the $3 level.

If XRP bounces off the $2.20 support and buyers take control, the price could rise toward $2.35, with a breakout above $2.52 nullifying the bearish scenario. However, if selling momentum persists and XRP falls below the $2.20 support, the next move toward $1.85 could unfold rapidly.

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