The price of XRP bounced up about 3% from the low point on March 27 at 1.31 USD and was able to reclaim the 1.35 USD area. However, this movement may be forming a bearish flag rather than a sustainable recovery, and the overall market conditions are not conducive to a significant recovery.
Since the peak of 1.60 USD on March 17, XRP has retraced 18%. Although the intraday rebound looks promising initially, the charts, derivatives, and on-chain data all show the same direction.
Bear Flag formation when the Hidden Bearish Divergence signal forms.
The 12-hour chart shows that XRP is trading within a descending flag pattern, with the flagpole formed during the 18% retracement from 1.60 USD to 1.31 USD between March 17 and March 27. Meanwhile, this recent 3% rebound is forming part of the flag in an upward channel, which typically ends with another down move similar in size to the flagpole.
If the lower support of the flag is broken, a move down of the same magnitude, 18%, may occur from the breakdown point, bringing the price of XRP down to the zone of 1.08 USD (which will be seen in the next section of the article).
The Relative Strength Index (RSI), a momentum measurement tool, adds another layer of concern. Between February 6 and March 28, on the 12-hour chart, prices are forming lower highs while the RSI is creating higher highs.
This is the occurrence of hidden bearish divergence, which generally indicates the continuation of the existing downtrend rather than a reversal.
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This divergence has not yet been confirmed. Confirmation requires the next 12-hour candle to close below 1.35 USD. If the price manages to hold above 1.35 USD, the structure will be postponed.
To completely invalidate this pattern, it must move above 1.60 USD, which is the peak of the flag, and if the overall market remains weak, this pattern may be confirmed quickly.
Nevertheless, even without RSI, both derivatives and spot data indicate that this rebound may be fragile.
Open Interest has increased, but Hodlers are decreasing their positions.
Since the rebound began, XRP's Open Interest has increased from 737.72 million USD to 759.21 million USD, or a growth of 2.9%. Meanwhile, the Funding Rate has decreased from -0.011% to -0.003%. This change indicates increased long positions in this rebound.
The increase in open interest during a rebound in a bear flag is often more of a warning signal than a confirmation of upward direction, as some traders using leverage are betting that prices will continue to rebound. However, if this pattern breaks down, these long traders may become fuel for liquidation.
Meanwhile, the spot market lacks sufficient momentum, as the Hodler net position change figure, a tool from Glassnode that tracks the accumulation of coins in long-term wallets (held for more than 155 days), has remained stable between March 19 and March 25 at around 238 million XRP.
However, since March 25, this balance has decreased to 229.78 million XRP or about 8.25 million tokens, accounting for 3.47%.
Those with high confidence are gradually reducing risk in the market before the price of XRP rebounds. Therefore, if the derivatives market leans towards long while spot holders reduce their holdings, the chances will lean towards the bears.
If the hidden bearish divergence signal from the RSI is confirmed and prices retrace this time, support from the spot side that needs to absorb selling pressure will be lacking. It remains to be seen whether spot buyers will come in like the new long traders just recently bought. Because if so, support from the spot side may help slow down the price drop.
Price prediction for XRP with a test of 1.35 USD.
The price of XRP needs to close the 12-hour period above 1.35 USD to extend the bearish scenario. If it breaks higher, levels of 1.37 USD and 1.40 USD will become the next resistance. However, considering the structure of the bear flag and divergence signals, a movement below 1.35 USD and holding there would be the beginning of the process to confirm the downtrend.
If the flag breaks and the support zone of 1.31-1.32 USD is breached, a move measuring approximately 18% will begin from the breakout point, bringing the price down to the area of 1.08 USD, which would be the lowest level of XRP since early February 2026.
Conversely, only movements above 1.60 USD can completely negate the downtrend structure and end the lower-high sequence that has characterized XRP's trading throughout 2026.
Currently, regaining the level of 1.35 USD is what separates a delayed bearish signal from a potential 18% pullback to the level of 1.08 USD.