Analytics firm Santiment reported on January 22, 2026, that XRP has entered an "Extreme Fear" territory in social sentiment following a significant price decline. According to Santiment's data, this bearish sentiment emerged after XRP experienced a roughly 19% pullback from its early-month high of around $2.42 reached on January 5.
Santiment's analysis suggests this extreme pessimism among retail traders historically precedes price rallies, operating on a contrarian principle where prices often move opposite to retail expectations. The firm shared a chart pairing XRP's 6-hour price candles with a social ratio measuring positive versus negative commentary, overlaying "buy" and "sell" markers tied to specific sentiment bands labeled as "fear zone" (where prices "go up"), neutral zone, and "greed zone" (where prices "go down").
The timing of these sentiment signals shows mixed reliability. The first "buy" marker on January 2 preceded a sharp rally from approximately $1.87 to $2.42 by January 6. The first "sell" marker on January 7 aligned with the market shifting from post-spike distribution into a downtrend, with XRP closing around $2.16 that day before sliding toward the low-$2.00s by January 12.
However, subsequent signals demonstrated the practical risks of such indicators. The second "sell" marker on January 11 was less straightforward, as XRP dipped on January 12 but then logged a sharp rebound on January 13 to around $2.17 before rolling back over. The third "sell" marker on January 13 appeared to target that rebound itself, with XRP fading through mid-month and ultimately sliding to a January 20 low around $1.87 intraday.
Recent "buy" markers on January 18 and January 20-21 showed the challenge of precise timing. The January 18 marker arrived early as XRP continued lower into January 20 before rebounding. The current January 20-21 marker fits better in the short term, with XRP bouncing from the January 20 close near $1.89 to roughly $1.95 by the time of reporting.
At press time, XRP traded at $1.9498, with the rebound remaining modest relative to the broader drawdown from the $2.4 area peak. Santiment's broader argument maintains that when social feeds tip into one-sided pessimism, marginal selling pressure may already be exhausted, setting up mean reversion, though "extreme fear" can persist if trend conditions remain heavy.
