Analyst Warns XRP Could Surge to $2.40 Before Sharp Drop

Pseudonymous analyst CryptoInsightUK warns of a potential trap for XRP, predicting a short-term surge to $2.30–$2.40 followed by a sharp decline. Key points include:

XRP may drop below $2.00 after reaching highs, causing pain for investors expecting an upward trend.
The analyst highlights significant liquidity buildup beneath current prices, statistically touched 80% of the time.
Despite holding over 95% of his portfolio in XRP, he advises caution regarding a potential correction.
He discusses two scenarios: immediate breakout or a rally that sweeps local highs before a downturn.
A bullish divergence pattern is being monitored, where lower lows in price can coincide with higher lows in the RSI, indicating possible bottoming.

Broader Market Conditions

Macro factors remain supportive, with four catalysts identified: stablecoin oversight legislation, SEC deadlines against Ripple, upcoming decisions on a spot-XRP ETF, and expectations for increased money supply due to fiscal policy changes.
The analyst believes these factors could positively impact XRP's performance.
In contrast, Bitcoin shows declining trading volume, indicating indecision, with a potential correction projected around the $96,000–$97,000 range.

Concerns Over XRP Spot Activity

Recent XRP activity shows increased open interest but warns of potential volatility if market levels are lost.
Imbalances in long and short positions could lead to aggressive downward movement if support fails.
XRP’s performance against ETH and BTC indicates a lack of decisive breakout, suggesting continued range-bound trading.

As of now, XRP is trading at $2.23.