XRP Pullback Below $3 Signals Potential Bull Trap as Bollinger Bands Hold Strong

XRP’s recent dip below the psychological $3 mark has sparked fears among traders, with the token plunging to $2.70 after a sharp market sell-off that triggered $1.6 billion in liquidations within 24 hours. Despite the correction, technical indicators suggest that bearish sentiment may be premature.

The weekly Bollinger Bands show XRP maintaining strong support above the midline at $2.70, with the upper band positioned near $3.54, leaving room for renewed upside momentum. Analysts warn that the drop beneath $2.90 may have shaken out late buyers, but the broader structure still favors bullish continuation. Market sentiment remains mixed, as repeated tests of the $2.77 support level continue to fail, signaling resilient demand from buyers.

Throughout the past month, XRP has been consolidating in a narrow range between $2.77 and $2.96. Sellers have repeatedly attempted to break below $2.77, yet the support has consistently held. This accumulation phase could pave the way for a short squeeze if bullish traders regain control, setting up the possibility of a breakout toward new highs.

The consolidation comes at a time of heightened crypto activity. Ripple’s USD stablecoin recently entered the top 100 digital assets, while institutional sentiment toward crypto continues to strengthen. Deutsche Bank issued a bullish statement on Bitcoin, and Coinbase announced the listing of two new cryptocurrencies on Ethereum and Solana, boosting overall market optimism.

If XRP successfully clears resistance above $3, it could mark a significant shift in market structure, opening the door for a push into higher ranges. With Bollinger Bands indicating strength, traders betting on a prolonged downturn may find themselves caught on the wrong side of the trade.

At present, the critical levels to watch remain $2.77 for support and $3 for resistance. A decisive move above this range could be the spark for XRP’s next major rally.