XRP's August Rally at Risk as September Pattern Looms

XRP recorded a 28.5% gain in August, the strongest August performance since 2021. The token had ended August in the red six times over the past nine years. Most of the rally occurred in the last fortnight.

Based on past performance, September could erase some of those gains.

Why Did XRP Surge 28% in August?

The rally coincided with a pickup in ETF purchases. According to SoSoValue, US spot XRP funds attracted $153.55 million in August.

The timing matters. Only $3.27 million entered between August 3 and 14, while $150.28 million flowed in during the final two weeks — a 46-fold increase. The buying streak has continued for nine consecutive positive sessions.

The $153.55 million is modest compared to XRP's $87 billion market cap, so it alone did not drive the price. In May, inflows of $130 million failed to prevent a decline. August marks the first month where significant inflows and a substantial price increase occurred together.

Bitcoin's streak of positive ETF flows ended on Friday, putting broader crypto ETF demand under scrutiny. XRP's inflows have remained intact. However, historically, a strong August has often been followed by a weak September.

Could XRP's Price Fall in September 2026?

Over the past eight years, September's direction has opposed August's in seven instances. When August declined, September rose in five out of six cases. In the two years when August gained, September dropped — 14% in 2020 and 19.6% in 2021.

Seasonality provides a pattern for price forecasting, not a guarantee, and eight years is a limited data set. This year, wallet data suggests a similar outcome and identifies the sellers.

Who Sold XRP During the Rally?

According to Santiment's HODL Waves metric, which categorizes wallets by holding duration, the rally saw a transfer of tokens. Wallets that held XRP for three to six months — coins acquired around March to May — reduced their supply share from 6.41% on August 8 to 5.76% at the time of writing.

Wallets with a holding period of one week to one month nearly doubled their share, rising from 1.68% on July 31 to 3.22% currently. This indicates the month's highest buying volume occurred around the August 21 peak.

This pattern has occurred before. Heavy buying accompanied the January 5 top, followed by weeks of quiet selling, after which XRP's price dropped 53%.

The volume on August 21 was even higher, making a specific chart level critical.

XRP Price Forecast for September

XRP is currently trading around $1.36, remaining within a descending channel that began in January. It is below the 200-period exponential moving average (EMA), which gives more weight to recent prices, currently at $1.56.

The $1.34 to $1.36 zone is crucial, as it contains the 100-period EMA and the first retracement level. A breakdown below this area could see XRP drop to $1.15, followed by $0.98 and $0.81. If the January decline repeats from current levels, the target would be around $0.58.

For a bullish outlook, XRP needs a two-day close above $1.69, the August high. The Federal Reserve's meeting on September 15-16, with updated economic projections, could serve as a decisive catalyst.

Analyst’s View: ETF inflows are genuine but came late and at higher prices. The selling wallets had held since March, when XRP was near current levels, and were about 23% down by late June. They held for five months and exited as soon as the rally brought them back to breakeven. September will reveal whether new buyers are ahead of the curve or the final entrants.