XRP on Track for $4: Technical Outlook Signals Strong Growth

XRP has decoupled from the broader crypto market, driven by positive regulatory developments for Ripple Labs, which have strengthened bullish investor sentiment toward the altcoin.

XRP Outperforms the Market with a 50% Surge in January

The token posted an impressive 50% gain in January, outperforming the rest of the crypto market. Technical indicators now point to a long-term breakout above $4.

XRP’s divergence from the market is largely attributed to favorable regulatory progress for Ripple Labs. The company secured approval for its stablecoin RLUSD from the New York Department of Financial Services on December 10, according to Cointelegraph.

Institutional Adoption Fuels XRP’s Rally

According to Santiment, another key driver behind XRP’s price surge is growing institutional adoption. In a post on January 29, the crypto analytics firm highlighted:

“XRP has recently gained recognition from major financial institutions, and its integration into various payment systems has strengthened investor confidence. Notably, Ripple’s partnership with Ondo Finance allows U.S. tokenized securities to be integrated into the XRP Ledger.”

Ripple Labs has also expanded its regulatory footprint by securing money transfer licenses in Texas and New York, adding to its over 50 existing licenses worldwide.

XRP Poised for a Breakout to $4 by March

XRP’s price action suggests a potential breakout above $4 before the end of February, according to technical patterns shared by crypto analyst Dark Defender.

In a January 30 post on X, Dark Defender noted:
“XRP is awaiting confirmation on the 4-hour and daily timeframes for a breakout. The short-term target is $4 with Wave 5, while support is at $3.07.”

Despite XRP’s strong rebound from its weekly lows of $2.70, traders should remain cautious about a potential bull trap forming below $2.95. The recent recovery has created high-liquidity zones, which could be targeted for price retracement.

The $3 level acts as a critical support zone, where most long traders are likely to place their stop-loss orders just below it. Market participants might push prices lower to trigger stop-losses and collect liquidity before a potential reversal.

A strong one-hour Fair Value Gap (FVG) and overlapping Order Block (OB) between $2.98 and $2.90 indicate a potential buy zone, where pending orders could absorb selling pressure and support a price rebound.