Reasons Why XRP Price Is Below $3 Even After a Significant Jan 2026 Rally

On January 6, 2026, XRP hit its highest price of $2.41. The strong rally began around January 2, as it was marked by improving market sentiments, continued inflows into spot XRP ETFs, and overall bullish momentum in the market, with a surge in the Bitcoin price. However, even with a positive surge, the XRP price has remained below $3. The current live price of XRP is $2.09. 

This article will look at reasons why the XRP price is below $3 after a significant rally this year. 

Profit Taking and Whale Activities 

When examining the XRP price, $3 appears as a major technical and psychological resistance point for the cryptocurrency. Even though there have been multiple attempts to break this point, it has only led to increased selling pressure as traders expect a resistance level at the particular price level. 

For example, the first major knock–back was seen in late October 2025, near $2.65. Even when buyers were the ones who drove the price upward, the demand was depleted by seller interference. Furthermore, investors who bought XRP tokens at lower prices sold them when the prices hit $2.65. Selling the tokens eventually increased the number of circulating supply, which has pushed down the price. Another reason for the price plunge is that there were more sellers at $2.65 than buyers. 

The selling pressure continued into early November as the XRP prices moved toward $2.52. Then the price stabilized near $1.80, which then rallied to $2.35. However, buyers cannot maintain the momentum, which suggests that the rallies are weak and doubtful.

New XRP Supply 

The low exchange balances and the release of a new supply create mixed sentiments in the market. Exchange balances for XRP have fallen over the past few years. In January 2026, it reached 1.6 billion XRP, which is a level not seen since 2018. A new supply of XRP is scheduled to be released on the first of February 2026, associated with Ripple’s automated monthly escrow program. It could add supply pressure. 

XRP is in a controlled downtrend 

XRP price continues in a descending channel that has influenced its prices since July. It is a clear indication that rallies can be short-lived. During high prices, it is defended by sellers, and recoveries become limited. 

After reaching $2 in January, XRP has attempted to break out from the resistance level. However, it failed due to a lack of sustained buying interest at higher prices. When prices moved towards $2.35, it reduced purchasing power and pushed sellers back in the market, which caused a further downward trend. 

Bottomline 

As mentioned above, XRP is currently trading at $2.09. If buyers can hold the $2 level, XRP prices could experience a rebound. Moreover, the upcoming policies, including U.S. Reserve developments and CLARITY Act confirmations, could improve the regulators and support demand during correction. 

If the selling pressure continues, it could push down the prices to $1.80. In such a case, buyers experience loss. Improving macro conditions are expected to catalyze a price rebound by stimulating demand. As sellers are in charge of the XRP price rallies, it is resistant below $3. Right now, rebounds are only possible with the support of macro conditions. If buyers fail to defend $2, it could go down to $1.80.