XRP Faces Defining Test at $1.35 as Analyst Flags Whale Sell-Off and Collapsing Network Activity

The cryptocurrency market rarely offers moments of absolute clarity, but XRP appears to be approaching one right now. After a turbulent three-week stretch that erased roughly 20% of its value, the digital asset has settled into a precarious position around the $1.35 mark — a threshold that crypto analyst Ali Martinez says could be the single most important price level in the token’s short-term outlook. XRP’s slide from a recent peak near $1.70 to the current $1.35 region has been dramatic, though not entirely unexpected. Sharp rallies in the crypto space are frequently followed by sharp corrections, particularly when momentum begins to fade and early buyers start locking in gains. The pullback has moved XRP through multiple psychological thresholds in a short amount of time, leaving traders on edge and prompting renewed debate about the asset’s near-term direction. Martinez, whose on-chain insights and technical price analysis are widely followed across the crypto ecosystem, considers $1.35 to be a critical support zone. Support levels are essentially price areas where demand has historically been strong enough to halt a decline, and when an asset touches such a zone after a steep drop, the outcome tends to set the tone for the sessions that follow. A successful defense of $1.35 could embolden bulls and attract buyers looking for value. A convincing break below it, conversely, could invite a fresh wave of selling and shift the technical narrative firmly bearish. XRP has built a reputation for defying expectations, and the coming days will test whether that resilience remains intact. Indeed, the combination of technical gravity and on-chain signals has turned this price point into more than just another chart level — it has become the line between hope and fear. For context, the decline mirrors broader trends across the altcoin market, where several major digital assets have struggled to maintain upward momentum amid shifting risk appetite. That makes the XRP setup not just a story about one token, but a bellwether for how investors are treating higher-risk crypto assets in the current climate.

So what has driven the sell-off? According to Martinez, profit-taking among large holders has played a central role. On-chain data shared by the analyst shows that addresses classified as whales have sold or distributed approximately 90 million XRP over the past week, funneling tokens toward a range of different wallets. In the cryptocurrency world, whale transactions are scrutinized closely because of their ability to move markets. A distribution of this size can add meaningful selling pressure, especially during periods of relatively low liquidity. The timing of the whale activity is notable. XRP’s run to $1.70 delivered substantial gains for investors who had accumulated earlier at lower prices, and as momentum stalled near the highs, the incentive to lock in those profits became increasingly difficult to ignore. This kind of behavior is well documented across financial markets: after strong rallies, large players often reduce exposure in stages, and those sales weigh on price until demand absorbs the supply. It is also worth noting that not every large transfer signifies an outright sale. Some distributions are conducted for operational reasons, such as moving funds between exchanges and over-the-counter trading desks, or preparing assets for custody arrangements. However, the sheer scale of recent whale movements, in combination with the downward drift in price, strongly suggests that a segment of XRP’s largest stakeholders has been de-risking. Martinez’s data adds a layer of transparency to an otherwise opaque market, showing that the correction is not merely a byproduct of algorithmic trading or random volatility. Real market participants are making deliberate decisions, and for now, those decisions are tilted toward distribution. Whale behavior often creates a feedback loop: visible selling pressure attracts more sellers, which depresses prices further and encourages additional distribution. Breaking that cycle requires a shift in confidence, which often means the arrival of new buying demand at lower levels. Whether that demand emerges around $1.35 is the question that now hangs over the market.

The whale activity, however, is only one part of the story. Data from the XRP network also reveals a significant drop in daily active addresses — a metric that tracks the number of unique wallets engaging in transactions. According to Martinez’s analysis, this figure has plunged by 90.18%, falling from 388,492 to just 38,163. The numbers are striking. A 90% decline in active addresses suggests that participation has collapsed at the retail and institutional level alike, at least in terms of on-chain activity. Daily active addresses are widely regarded as a proxy for real-world usage and investor interest. High readings often coincide with periods of strong sentiment, while low readings can signal apathy, indecision, or fear. The sharp drop seen during XRP’s correction paints the picture of a market that has stepped back from the table. Some of the decline can be attributed to natural behavior following a price slump. When markets fall sharply, traders typically retreat to the sidelines to reassess risk. Speculative activity tends to dry up, and fewer people feel the need to move tokens around when the direction of the market is unclear. Still, the magnitude of this drop is remarkable, and it suggests that XRP is currently operating in an environment of reduced engagement. That carries implications for volatility. In a market with fewer active participants, order books become thinner, which means that even moderate-sized trades can have outsized price impacts. This can work in both directions — a large buy order can spark a swift rally, just as a large sell order can trigger a sharp decline. For now, though, the on-chain data indicates a cautious, low-participation environment, and that is a sentiment signal in its own right. Investors appear to be waiting for a clearer calling card before re-engaging. Although participation metrics often dip alongside prices, a contraction of this magnitude is noteworthy and underscores how quickly sentiment can shift in the digital asset space. It also reflects the broader state of the altcoin market, which has seen similar patterns of cooling interest following periods of heightened activity. The combination of whale distribution and collapsing active addresses paints a cautionary picture, yet the resilience of the $1.35 support level suggests the sell-off may be losing momentum.

Despite the bearish signals, there is a compelling reason to believe that XRP might be nearing a bottom. Martinez notes that the $1.35 level has historically acted as a strong support, and the numbers back that assessment: approximately 2.29 billion XRP have changed hands in this price region over time. That staggering volume represents a dense concentration of historical trading activity, and technical traders place considerable weight on such levels. They represent not just lines on a chart, but zones where real capital was committed, where buyers and sellers previously established positions, and where future market participants are likely to react. The massive turnover at $1.35 serves as a kind of anchor for the price. When the market returns to a level with such a rich trading history, the likelihood of buyers stepping in increases substantially. Many investors who purchased XRP near this price before may be inclined to add to their positions, while those who missed the entry earlier may view it as an attractive opportunity. This dynamic can create a self-fulfilling prophecy: the more participants who recognize the level’s importance, the more likely it is to hold. Large volume zones like these are often monitored by institutional traders who use historical levels to gauge entry and exit points, and the presence of 2.29 billion XRP in this area reinforces the idea that the price floor has structural support, not just emotional significance. Of course, support levels are not immutable laws. In a highly volatile market like cryptocurrency, even the strongest floor can fail under the weight of unexpected news or a rapid deterioration in market-wide sentiment. Regulatory announcements, macroeconomic shifts, or sudden changes in risk appetite can overwhelm technical considerations. But as far as signals go, the volume profile at $1.35 is one of the most encouraging data points for XRP bulls in recent weeks. It suggests that the selling pressure could be absorbed by committed demand, and that the market may be in the process of establishing a base from which the next move higher can begin. Whether that base is durable depends on the actions of buyers and sellers in the sessions ahead.

Looking forward, Martinez has outlined a clear set of scenarios for what happens next. If the $1.35 support level holds and XRP manages to reclaim the $1.38 mark, the analyst believes the price could recover initially toward $1.60, with a subsequent target at $1.68. The pathway described by Martinez is rooted in technical logic. The immediate resistance to overcome is $1.38, a level that XRP has struggled to push through during recent trading sessions. A daily close above this threshold would provide early confirmation that buyers have regained the initiative. From there, the asset would need to build enough momentum to retrace a significant portion of its recent losses, targeting $1.60 as a first major waypoint. Should that level be taken out, $1.68 would represent the next challenge — a price point that sits just shy of the $1.70 peak from which the correction began. In effect, the bullish scenario laid out by Martinez suggests that XRP could fully retrace its losses if the current support base proves genuine. For bulls, this roadmap offers a clear gauge of progress. The more time XRP spends above key levels, the more confidence traders are likely to gain in the recovery narrative. Conversely, Martinez emphasizes that the $1.35 support level remains the most critical marker to monitor for XRP in the short term. A decisive break below it would invalidate the bullish set-up and likely open the door to deeper declines. In technical terms, the asymmetry of the current setup — defined upside targets against a well-identified downside risk — is precisely what draws traders to moments like these. It is a high-stakes environment, but a clearly defined one. The market has essentially painted itself into a corner where the next meaningful move in XRP will be determined by whether the $1.35 floor holds or gives way. As the trading days unfold, that is the level that all eyes will be tracking.

Taken together, the data surrounding XRP tells a story of a market in transition. The token has suffered a sharp correction, shedding approximately 20% of its value over three weeks. Whale addresses have distributed tens of millions of coins, adding to the selling pressure. Network activity has collapsed by more than 90%, reflecting a pronounced withdrawal from participation. And yet, against that backdrop, the $1.35 support zone remains intact — hardened by billions of dollars in historical volume and carrying the clear attention of analysts and traders alike. The immediate path forward is defined by two scenarios. In the first, support holds and XRP climbs back above $1.38, unlocking a recovery toward $1.60 and potentially $1.68. In the second, the support fails and the token descends into unexplored territory, triggering additional losses and reshaping the short-term outlook. That binary nature is part of what makes the current moment so compelling. For long-term investors, the recent turbulence may amount to little more than another volatile chapter in XRP’s ongoing evolution. The asset, often associated with Ripple’s payment ecosystem, has withstood many previously uncertain periods, and its availability across major exchanges and its established presence in the digital asset ecosystem remain unchanged. For short-term traders, however, the next sessions carry outsized significance. The price action around $1.35 will deliver a verdict on the market’s current state of mind. It is worth keeping in mind that cryptocurrency markets are shaped by forces far beyond technical patterns. Macroeconomic conditions, regulatory developments, global liquidity flows, and broader sentiment in the technology sector can all intervene at a moment’s notice. Technical analysis provides a map, but it cannot predict every twist in the road. As always, this article is for informational purposes only and does not represent investment advice. Anyone trading or investing in XRP should conduct their own research, assess their own risk tolerance, and make decisions based on their personal financial circumstances. In the unpredictable world of crypto, the only guarantee is that the market will keep moving — and the battle for $1.35 is the next chapter in that story.