Is XRP’s $1 price zone a bear trap? Here’s what the data suggests
XRP approaches a make-or-break moment at $1 as derivatives turn increasingly bullish. Is a squeeze on the horizon?
Talk of a new altcoin cycle is starting to pick up again.
Based on how this week has played out, that narrative is beginning to gain traction. On the weekly timeframe, while Bitcoin [BTC] is up more than 5%, Ethereum [ETH] has attracted 2x the capital inflows, pushing the ETH/BTC ratio up nearly 7%. More importantly, this marks the ratio’s strongest weekly gain since August 2025, reinforcing the idea that “altcoin-led” momentum is starting to build across the market.
Ripple hasn’t been left behind. As the chart below shows, the token is up nearly 9% this week, with its highest wick reaching $1.18, a level it hadn’t reclaimed since losing it in mid-June. That move points to strong buying interest as capital continues rotating into higher-beta altcoins.
Backing this up, the XRP/USDT ratio has also climbed more than 3% this week.
Against this backdrop, leaning long on XRP isn’t a stretch. In fact, an analyst recently flagged a whale opening a $16 million XRP long at an average entry of $1.10. At the time of writing, the position was already sitting on roughly $477,000 in unrealized profit.
With altcoin momentum continuing to build, this doesn’t look like a random high-leverage bet. If anything, it signals growing conviction that XRP still has room to move higher as capital continues rotating into altcoins. That naturally raises the question: Is XRP’s current setup quietly turning into a textbook bear trap?
XRP’s leverage spike puts the $1 level under the spotlight
Long positioning in XRP is starting to go parabolic.
Normally, when leverage gets this crowded on the long side, the risk of a volatility event increases. Even a modest shift in sentiment can trigger a wave of long liquidations, especially with XRP still trading around the $1 supply zone. In that scenario, the ongoing altcoin rally alone may not be enough to keep the uptrend intact.
That’s why the case for a near-term pullback is gaining traction, with liquidity continuing to stack up around the $1 level. But institutional positioning paints a different picture, suggesting XRP’s latest move isn’t just riding the broader market’s altcoin momentum.
As the chart above shows, it’s been another strong week for spot XRP ETFs.
According to SoSoValue, U.S. spot Ripple ETFs recorded $17.19 million in inflows over the period. This came despite two days of net outflows during the week, showing demand remained resilient. More notably, the ETFs have now logged nine consecutive weeks of net inflows, pointing to “sustained” institutional interest.
By contrast, Ethereum ETFs have posted consecutive net outflows over the same period. This divergence could set XRP apart from other altcoins. In simple terms, while ETH is leading short-term gains, it still looks driven by capital rotation.
XRP, on the other hand, is showing stronger longer-term momentum, making its consolidation around $1 look more like a potential bear trap, with long positioning adding to the bullish pressure.
Final Summary
- Altcoins are gaining momentum, with ETH and XRP both seeing strong weekly inflows and price gains.
- Even with heavy long leverage near $1, steady XRP ETF inflows suggest demand is still strong and a bear trap is possible.
