XRP At Critical Juncture: RSI Divergence Signals Potential Breakdown Below $1.26

As of late February 2026, XRP finds itself at a pivotal technical crossroads. The token has retreated approximately 13% since failing to sustain momentum above the $1.67 level, now hovering dangerously close to what may be its last meaningful support barrier. More troubling for bulls, the charts are flashing a critical warning signal: a hidden bearish RSI divergence that preceded the recent rejection. This technical setup, combined with massive whale distribution activity and shifting long-term holder sentiment, paints a precarious picture heading into the final stretch of February.

The Whale Exit: Tracking $50M Distribution Against Hodler Resistance

The narrative on XRP’s blockchain tells a story of two opposing forces locked in a high-stakes tug-of-war. Large wallet holders—those managing positions between 10 million and 1 billion XRP—have orchestrated a coordinated exit of approximately 50 million XRP ($75 million at recent prices) during the latest rally attempt. This influx of supply has come precisely when buyer demand needed to be strongest.

On the flip side, long-term holders have attempted to step in as the “smart money,” accumulating aggressively and expanding their net positions by 17% to reach 150 million XRP. However, this defensive buying is notably weaker than the record-breaking accumulation witnessed on February 1st, suggesting that conviction among true believers remains conditional rather than absolute. The 442 million XRP accumulated between $1.27 and $1.28 represents the most significant buyer cost basis cluster on the current chart—a wall that will either hold or collapse the entire technical structure.

Technical Weakness Emerges: Hidden Bearish Divergence on Daily Charts

Beyond the surface-level price action, a more sinister warning has materialized in the technical indicators. On the 12-hour timeframe, XRP’s RSI formed a higher high while price itself formed a lower high—the classic hallmark of a hidden bearish RSI divergence. This divergence telegraphed exactly what transpired: the rally was exhausted despite appearing to push higher, and sellers exploited that weakness ruthlessly.

The price rejection at $1.67 came with a characteristic long upper wick, confirming that institutional and large retail sellers have established a formidable defensive line overhead. What makes this pattern particularly concerning is the context: XRP has been etching out a rising wedge formation since early February, a technical structure historically associated with trend exhaustion rather than continuation. A decisive break below the lower trendline would project a 26% correction, putting the psychological $1.00 mark squarely in focus.

Current price sits at $1.35 as of February 27th, representing a -3.15% move over the past 24 hours—a gentle slide that could accelerate into something far more violent if technical support gives way.

Cracking the $1.26 Defense: What Happens Next for XRP

The $1.26 support zone is no arbitrary level—it represents the epicenter of accumulated buyer intent. Approximately 442 million coins remain underwater if this support crumbles, and that would almost certainly trigger a cascade of stop-loss liquidations and panic selling. The immediate downside trajectory targets $1.16 and subsequently $1.06, completing the rising wedge breakdown pattern.

Should bulls wish to invalidate this bearish outlook entirely, they must accomplish two specific objectives: first, XRP must reclaim and hold above $1.48, and second, achieve a sustained close back above $1.67 to signal a genuine reversal in underlying momentum.

From $3.65 to Current Levels: The Macro Risk Picture

Zooming out reveals the magnitude of XRP’s vulnerability. The token’s all-time high of $3.65 sits as a reminder of past euphoria, yet the current price of $1.35 represents an 63% drawdown from that peak. The network remains robust with 7,660,083 active holding addresses, demonstrating that retail participation has not collapsed entirely. However, on-chain concentration metrics and the coordinated whale distribution suggest that large stakeholders are content to reduce exposure ahead of potential further downside.

The technical setup, combined with whale behavior and the emergence of the RSI divergence warning signal, creates an environment where risk significantly outweighs opportunity for momentum traders. Defensive positioning remains warranted until clearer technical confirmation emerges.

Important Disclaimer

This analysis is provided for educational and informational purposes exclusively and should not be construed as financial advice, investment guidance, or recommendations regarding XRP or any digital asset. The technical patterns discussed—including rising wedges, bearish divergences, and RSI patterns—are probabilistic tools and offer no guarantee of future price performance. XRP remains highly volatile; prices can shift dramatically within short timeframes, and a collapse below the $1.26 support level could result in substantial capital losses for positioned traders and investors. Conduct thorough independent research and consult with a qualified financial advisor before deploying capital into Ripple’s XRP token or any cryptocurrency position.