XRP has climbed above the $3 mark for the first time in years, fuelling speculation that the token could be heading towards record levels. Analysts point to strong institutional demand, renewed derivatives activity, and technical signals that suggest a sustained uptrend may be underway.
Institutional Demand Strengthens
Investment interest in XRP has been gaining ground. Data from CoinShares shows that exchange-traded products tied to XRP attracted $14.7 million in inflows during the week ending 5 September. This brought the year-to-date total to $1.4 billion.
While Bitcoin pulled in $524 million in weekly inflows, Solana saw $16.1 million and Sui $600,000. Ether, however, recorded $912 million in outflows, raising the possibility of capital rotating into other digital assets, including XRP. Anticipation of a potential XRP exchange-traded fund approval in the United States has been a major factor driving this shift.
Derivatives Market Turns Bullish
Speculative activity around XRP is also showing renewed momentum. Open interest in XRP futures rose by 11 per cent in the last seven days, reaching $8.3 billion, up from $7.4 billion on 4 September, according to CoinGlass data. In the past 24 hours alone, open interest grew by 4 per cent.
The funding rate, which reflects the balance between long and short positions in perpetual futures contracts, has remained positive since the beginning of August. This steady rise suggests more traders are positioning for price increases rather than declines.
Technical Breakout from Consolidation
XRP has been consolidating within a symmetrical triangle pattern since mid-July on the daily chart. The token broke out of this range earlier in the week, closing above $2.95. Analyst CasiTrades noted that the breakout is now being confirmed with the $3 test.
Momentum indicators also support the bullish view. The relative strength index has climbed from 36 to 54 in the past week, reflecting growing buying pressure. Key levels to watch above $3 include $3.08 and $3.27, with Fibonacci extensions pointing towards the $4.50 region.
Resistance Levels Ahead
Despite the optimism, analysts caution that XRP still faces hurdles. The multi-year high of $3.66 is expected to act as significant resistance before any move towards $4.50 can materialise. Shorter-term patterns suggest that a decisive close above $3 could trigger rallies towards $3.12 and $3.40.
Egrag Crypto highlighted that an ascending triangle on the four-hour chart supports a near-term target of $3.12, provided the token holds above $2.97. Other analysts take an even more bullish stance, arguing that XRP remains on course for $20 during the current market cycle based on Elliot Wave analysis.
Outlook
With institutional inflows growing, derivatives traders turning positive, and technical charts showing strength, XRP appears positioned for further gains. A break above $3.66 could open the path towards the $4.50 level, while a potential US ETF approval may provide the spark for even higher valuations.
