XRP bounces, but $2 remains the hurdle as exchange supply hits 8-year low

Exchange balances have decreased by about 57% since October, suggesting tokens are moving into longer-term storage.

Updated Jan 2, 2026, 3:14 a.m. Published Jan 2, 2026, 3:14 a.m.

XRP pushed up to $1.87 as exchange-held supply fell to its lowest level since 2018, reinforcing a tightening-float narrative even as price remains stuck below the heavy $1.88–$2.00 resistance band that has repeatedly capped rebounds.

News background

Exchange balances are being treated as a key signal again. Supply held on trading venues has fallen to roughly 1.6 billion XRP, down about 57% since October, suggesting more tokens are moving into longer-term storage or custody rather than sitting ready to be sold.

That drawdown is arriving during a broader phase of selective positioning across majors: institutions have increasingly leaned on structured and regulated rails for exposure while spot markets remain choppy, leaving tokens like XRP trading with a supportive long-term bid but fragile short-term momentum.

For XRP specifically, the falling exchange inventory matters because it can amplify moves when demand picks up — but it doesn’t guarantee upside if sellers show up at known technical levels (and $2 has been that level).

Technical analysis

XRP climbed roughly 1.7% from $1.84 to $1.87, printing higher lows through the session and holding a relatively contained $0.05 range (about 2.5% intraday volatility). Participation improved at the right moment: volume expanded during the push higher (around 32 million, about 50% above average) — a sign this wasn’t simply drifting upward on thin liquidity.

But the tape still reads like controlled recovery inside a broader ceiling. XRP repeatedly slowed as it approached the $1.88 area, a level that also lines up with a broader resistance zone ahead of the psychological $2.00 handle. That matters because recent attempts to reclaim $2 have failed quickly, turning the area into a supply zone where sellers are comfortable leaning on rallies.

Momentum indicators are mixed. Some oscillators show bullish divergence (momentum improving even as price hasn’t fully broken out), but the market still needs follow-through above resistance to validate it. On the lower side, the structure looks constructive as long as XRP holds above the $1.82–$1.83 base from the session’s early tests — and more broadly above the $1.77 floor that has acted as the next clear demand pocket.

Price action summary

• XRP advanced from $1.84 to $1.87, posting a steady series of higher lows
• Volume expanded during the move higher, peaking around 32M, roughly 50% above average
• Price stalled near $1.88 resistance, keeping the broader $1.77–$2.00 range intact
• Late-session action consolidated around $1.873, signaling an inflection point rather than a breakout

What traders should know

The story is a tug-of-war between tightening available supply and a well-defined resistance ceiling.

Key levels are clean:

• Bull case: A sustained push above $1.88 opens the door to a run toward $1.95, with $2.00 as the breakout trigger. A clean reclaim of $2 would likely pull in momentum buyers and force repositioning from sellers who have been defending that zone.
• Bear case: Failure to hold the $1.82–$1.83 base shifts focus back to $1.77, the next meaningful demand pocket. If that breaks, risk extends lower into the next broader support region (where buyers historically reappear), but the near-term battlefield is clearly $1.77 vs. $1.88.

For now, shrinking exchange supply keeps the longer-term setup constructive — but the market still needs a decisive win above $1.88–$2.00 before the upside narrative can take control of the tape.

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The breakout was supported by spot activity, indicating a healthier market move.