Ripple's XRP, alongside the rest of the cryptocurrency market, experienced significant volatility in recent months, but there are signs of potential recovery on the horizon.
Data provided by prominent analyst CW suggests that XRP's spot trading volume has recently stabilized. Historically, such a cooling phase in volume can indicate a price bottom and precede a subsequent rally.
The $XRP spot volume bubble map shows the current state of cooling.
In general, cooling phase indicates oversold and it is most appears in the bottom state.$XRP ETFs are being continuously listed, and global liquidity is increasing. With the continued listing of ETFs, $XRP is… pic.twitter.com/tfkW8ZsfFr
— CW (@CW8900) December 2, 2025
The accompanying bubble map aligns with previous reports indicating that the broader market downturn observed since early October was largely driven by leveraged trading activities.
Specifically for XRP, the map illustrates a pattern where periods of overheating spot volume (represented by red dots) are followed by extended correction phases. However, this has not been the case in recent months, with the last significant red dots appearing after the price surge to $3.40 in late 2024/early 2025.
Based on this data, CW concluded that XRP's current spot volume levels signify a "state of cooling." This condition is interpreted as an indicator of oversold conditions, which historically coincide with price bottoms.
The analyst anticipates that this cooling phase will be temporary, citing the consistent launch of new XRP Exchange-Traded Funds (ETFs) and their impressive inflows. Reports indicate that XRP spot funds have outperformed their Bitcoin, Ethereum, and Solana counterparts since the first XRP ETF debuted in the U.S. market in mid-November.
CW further noted an increase in global liquidity. This, combined with the growing inflows into XRP spot ETFs, could potentially lead to a substantial price appreciation for XRP. Currently, XRP is trading just above the critical $2.00 support level. Despite the company behind XRP, Ripple, recording its best year to date, the token remains down on a year-to-year basis.