⚓ XRP AT A CROSSROADS: OVERSOLD SIGNALS AND CAPITULATION FLOORS HINT AT A $1.79 RELIEF BOUNCE

XRP is entering the first week of February 2026 under immense technical and fundamental pressure, having shed 16% of its value in late January. As of February 4, 2026, the asset is trading near $1.62, pinned below the $1.70 resistance as a month-long downtrend persists. While institutional caution is evident highlighted by a record $92.9 million ETF outflow on January 29 on-chain metrics are beginning to flash signals of “loss saturation.” With short-term holder losses reaching a three-and-a-half-year high and momentum indicators like the Money Flow Index (MFI) hitting oversold levels, the stage is set for a potential technical rebound toward $1.79, provided the critical $1.54 support remains intact.

Institutional Volatility: The ETF Flow Tug-of-War

The institutional appetite for XRP has turned volatile, reflecting broader macroeconomic uncertainty.

• The Record Outflow: On January 29, spot XRP ETFs recorded their largest daily outflow since launch, totaling $92.92 million. This exodus coincided with a 9% price drop, signaling that institutional players were quick to de-risk during the market crash.
• A Fragile Recovery: Although Friday saw a temporary recovery with $16.79 million in inflows, this was short-lived as the current week opened with renewed net outflows. Stabilization in these flows is now a prerequisite for any sustained price recovery beyond a simple technical bounce.

Capitulation Signals: Short-Term Holder Losses Hit Multi-Year High

A critical indicator suggests that selling pressure may be reaching a point of exhaustion.

• STH-NUPL at -0.38: The Short-Term Holder Net Unrealized Profit and Loss (STH-NUPL) metric has reached its lowest point since July 2022. This level reflects widespread capitulation among recent buyers.
• The Silver Lining: Historically, when losses for short-term traders become this saturated, the incentive to sell further diminishes. This “loss saturation” often removes excess sell-side liquidity from the market, creating the “supply vacuum” necessary for a rebound if demand returns.

Technical Roadmap: The Oversold Rebound Toward $1.79

XRP’s price action is currently showing classic “oversold” characteristics that often precede short-term reversals.

• The MFI Signal: The Money Flow Index (MFI) is hovering near the oversold threshold. In previous cycles, a similar setup catalyzed a 14% surge within 48 hours.
• The Breakout Target: If XRP can decisively reclaim $1.70, the probability of a relief rally toward $1.79 increases significantly.
• The Downside Floor: The bullish thesis remains fragile. A rejection at $1.70 would likely lead to a retest of $1.54 or even $1.47. Losing these support levels would signal a continuation of the month-long downtrend and invalidate the immediate recovery setup.

Essential Financial Disclaimer

This analysis is for informational and educational purposes only and does not constitute financial, investment, or legal advice. XRP price predictions and recovery signals are based on market data as of February 4, 2026. On-chain metrics like STH-NUPL and technical indicators like the MFI are probabilistic and do not guarantee future performance. Institutional ETF flows are highly reactive and can shift rapidly based on macro events. XRP remains a high-risk asset subject to extreme volatility; failing to hold key support levels could result in significant capital loss. Always conduct your own exhaustive research (DYOR) and consult with a licensed financial professional before making significant investment decisions.

Do you think the $1.62 zone is a generational “buy the dip” opportunity, or will the $92M ETF outflow lead to a sub-$1.50 crash?