Monero’s Rally Shows Cracks as February Risk Looms for XMR

Monero (XMR) has been one of the standout performers in recent months, delivering gains of roughly 57% over the past three months and climbing about 17% in January alone. That momentum, however, is beginning to unravel. After peaking near $799, XMR has already dropped around 36% in just the past week, signaling that sellers are starting to regain control.

This retreat isn’t just a routine cooldown. Technically, Monero is tracing out a rising wedge — a pattern often associated with trend exhaustion. While prices continue to make higher highs, the narrowing structure suggests weakening conviction beneath the surface. When rising wedges fail, they tend to break decisively lower, and the projected downside from this setup points to a potential 44% decline if support gives way.

Seasonality adds another layer of caution. February has been a consistently difficult month for Monero in recent years. Since 2023, XMR has recorded negative February performances, with average monthly losses ranging between 8% and 16%. Notably, those declines often followed strong January rallies — a setup that looks uncomfortably familiar today as the calendar turns.

Momentum indicators reinforce the warning signs. While Monero printed higher price highs between November and mid-January, the Relative Strength Index (RSI) failed to confirm the move, forming lower highs instead. This bearish divergence often precedes trend reversals. Adding to the pressure, XMR has slipped below its 20-day exponential moving average, a key short-term trend gauge. If the price also loses the 50-day EMA — which closely aligns with the lower edge of the wedge — it would mark a broader breakdown in trend support.

Capital flows are also turning less supportive. The Chaikin Money Flow indicator has dipped below zero, suggesting funds are moving out of Monero rather than into it. CMF is now testing a rising trendline that has held since early December. A decisive break would confirm sustained distribution, further stacking the odds against a quick upside recovery.

From a levels perspective, a daily close below $479 would be the key trigger for a deeper bearish move, opening downside targets near $360 and then $318 as part of the broader 44% measured decline. On the flip side, the bearish outlook would weaken if Monero can reclaim and hold above the 20-day EMA. A sustained push back above roughly $591 would ease momentum divergences and reduce the risk of a February breakdown.

For now, Monero’s January strength hasn’t vanished entirely, but the technical foundation beneath it is starting to fracture. With February’s historical headwinds approaching and momentum rolling over, the next move is likely to be decisive — determining whether XMR stabilizes or slides into another red February.