XRP has technically entered a breakout zone that could allow a further 17% rise, but about 1.5 billion tokens stacked around break-even prices have emerged as a near-term ceiling.

On May 6, blockchain media outlet BeInCrypto reported that XRP showed both a cup-and-handle breakout and a bullish divergence, but on-chain data indicated selling pressure was also increasing.

The rebound setup looks relatively clear based on the technical trend alone. XRP formed the cup from March 23 to April 17, then went through a pullback in the handle from April 17 to May 2. It then moved above the top of a descending channel on May 2, confirming the pattern breakout.

Ahead of the breakout, the relative strength index (RSI) also flashed a reversal signal. From Feb. 7 to April 29, XRP prices made lower lows while the RSI made higher lows, forming a standard bullish divergence. That signal points to the possibility of a reversal near the end of a downtrend, and it led to a cup-and-handle breakout in just three trading days after April 29. Since April 29, XRP has already risen by more than 6%.

Moving averages are also tilted toward short-term strength. XRP is currently trading above the 20-day exponential moving average of $1.4 and the 50-day exponential moving average of $1.408. The gap between the two lines is narrowing, raising the possibility of a bullish crossover in which the 20-day line moves above the 50-day line. On April 13, XRP rose 11.43% after moving above the 20-day line and then broke above the 50-day line.

The issue is on-chain indicators, with two main burdens. First, the exchange net position change increased from about 37 million XRP on May 4 to about 46 million XRP on May 5. Increased inflows to exchanges are typically interpreted as rising supply waiting to be sold. The outlet said this indicated selling pressure was emerging during the upswing.

Actual supply is concentrated at specific price levels. Based on Glassnode data, 1.57 billion XRP are clustered in the $1.41 to $1.42 range. That is supply sitting just below the current price of $1.43. Buyers at that level are near break-even, making them more likely to sell into an upper rebound. The outlet explained that break-even holders have historically been the biggest source of supply at the top.

Resistance also remains above that. An additional 414 million XRP are concentrated in the $1.47 to $1.48 range. As a result, even if the $1.41 to $1.42 supply does not come out in heavy selling, the market would still need to absorb the $1.47 to $1.48 zone for the uptrend to continue. If holders in the $1.41 to $1.42 range sell at break-even, the handle breakout weakens, while holding that supply opens the path to the next resistance level.

The short-term pivot is also relatively clear. Immediate resistance is $1.435, the 0.382 Fibonacci level. If XRP closes above that level on a daily basis, it could move toward $1.462 and $1.490. If it then breaks above $1.49, the view opens to $1.529 and $1.551 beyond the $1.47 to $1.48 supply zone.

The key confirmation line is $1.551. If XRP posts a daily close above that level, the cup-and-handle target is activated, with a measured upside target of about $1.811. That is about 17% above the current level. On the downside, it needs to hold $1.401 to keep the pattern intact. If that level breaks, the next support is $1.345, followed by a long-term bottom area of $1.277. The outlet said the breakout scenario would be invalidated if XRP falls below $1.278.

XRP has ultimately entered a zone where bullish technical signals face off against short-term selling pressure. The rebound structure on the chart is close to completion, but whether the rise can be sustained depends on absorbing the break-even supply.