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$XRP is currently testing the nerves of traders as its price action approaches a make-or-break horizontal support level.
At the same time, a key technical indicator is flashing a signal that could point to an impending reversal.
Coupled with strong retail accumulation, $XRP finds itself in a rather peculiar spot.
Critical support and bullish divergence
The asset has been in a localized downtrend over the past few days. The price steadily declined from the $1.44 range on March 21, sliding down to test critical horizontal support just below the $1.38 mark by March 23.
However, the RSI indicator at the bottom of the chart has formed a distinct sequence of higher lows while the price has formed a series of lower lows. The indicator has now climbed out of the oversold territory (the 20-30 range).
This discrepancy between the price of the Ripple-linked cryptocurrency and the momentum oscillator creates a classic bullish divergence.
This might mean that the cryptocurrency's underlying selling pressure is actually weakening.
Strong retail demand
According to a recent market report from 10x Research, $XRP is defying broader institutional trends by riding a wave of "strong retail demand" and expanding network utility.
Institutional money is heavily favoring other major Layer-1 networks. $XRP ETFs, for instance, saw a meager $0.6 million in positive flows.
However, according to blockchain analytics firm Santiment, the $XRP Ledger recently surpassed 5.6 million wallets holding under 100 $XRP.
It is also worth noting that $XRP spot ETFs have performed relatively well overall.
Total net assets across all providers sit just above the $1 billion threshold, representing approximately 1.14% of the total $XRP market capitalization, SoSoValue data shows.
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