As 2026 begins, XRP has started the year on a bearish note, with investor sentiment plummeting to levels of extreme fear. Despite these challenges, analysts suggest that this negative factor could set the stage for a major bullish reversal in line with historical trends.
Institutional buyers remain active
report This shows that XRP gains are often preceded by extreme sentiment, sometimes resulting in impressive gains of over 1,000%. Bearish mentions of XRP are currently 20-30% higher than the subdued average seen in November, according to Santiment data.
This deepening negativity, coupled with XRP’s stability between $1.8 and $1.9, highlights a “classic market disconnect.” In other words, sentiment continues to deteriorate while prices remain firm, suggesting an emotional capitulation is occurring sooner than a fundamental deterioration.
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However, under this wave of retail anxiety, organizational behavior paints a more positive picture. Spot XRP Exchange Traded Fund (ETF) (ETF) recorded approximately $424 million in inflows in December alone, making it the best-performing crypto ETF product.
This contrast between extreme retail sentiment (currently at an extreme fear level of 24) and significant institutional accumulation, amounting to approximately $1.3 billion over the past 50 days, often precedes a market reversal more reliably than sentiment measures alone would indicate.
Chance of bullish reversal is 70-75%
In the case of XRP, the current settings have extreme fear readings; social emotions This is well above the baseline, and along with the solidity of prices, has created a historic pattern that has resulted in several large increases since 2020.
For example, going back to the 2020-2021 cycle, XRP fell to $0.17 during the U.S. Securities and Exchange Commission (SEC) lawsuit, and then rose 1,053% to $1.96 in just four months.
Today’s scenario reflects this past event. Because of the large discrepancy in institutional accumulation, capitulation of retailHistorical data suggests that this combination has a 70-75% chance of a bullish reversal within the next 2-8 weeks.
XRP’s current trading conditions are around $1.90 and the Fear & Greed Index is 24. This configuration creates three potential scenarios.
Three potential price scenarios for XRP
In the most favorable bullish scenario, the Trump administration could announce clear pro-crypto regulatory policies in the first quarter of this year, BlackRock could file an XRP ETF application, or Ripple could be adopted. RLUSD Stablecoin It has the potential to quickly expand to more than $2 billion to $3 billion.
Historically, when the Fear & Greed Index rises from 24 to neutral territory (between 50 and 60), XRP often rises between 30 and 50%, with a target value set between $2.44 and $2.82. If the bullish momentum continues to mild greed (70+), XRP could reach the $3.00 to $3.20 range.
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In a more neutral scenario, ETF inflows could average $200 million to $300 million per month, and sentiment could gradually normalize without any dramatic catalysts. As RLUSD grows organically through existing partnerships, concerns are likely to subside on their own in six to eight weeks.
as fear and greed index Rising from $24 to the $45-$55 range, XRP typically gains 15-25%, targeting $2.16 to $2.35. If the support at $1.85 persists into January and the trading volume expands above $1.98, the price could expand towards $2.40-$2.50.
In the event of a bearish outcome, sentiment could remain unmitigated in extreme fear (under 30s) for more than 8 weeks. If there is significant volume and a decisive break below $1.85, the support level for the XRP test will be around $1.65 to $1.70.
On the back of a broad recovery in the cryptocurrency market, the altcoin has risen more than 6% towards $1.98 in the past 24 hours.
Featured image from DALL-E, chart from TradingView.com
