Although there is a glimmer of hope with a modest 0.92% increase in the latest daily trading session, the overall outlook indicates that XRP may not be primed for the anticipated surge just yet.
The lack of momentum is evident in recent declines of 5.93% monthly and 2.79% weekly as XRP has struggled against the upper resistance boundary of a triangle pattern.
Emergence of Encouraging Rally Indicators
On the weekly chart, XRP has formed a symmetrical triangle, hinting at a possible upswing. This pattern is often seen as a bullish sign, suggesting a potential shift towards an upward market direction as selling pressure eases.
Further boosting positivity on the charts is the Chaikin Money Flow, indicating that XRP is currently being accumulated and moving towards the positive zone.
However, the symmetrical triangle is not the only bullish signal. A deeper analysis reveals that retail investors are actively contributing to the prospective rally.
Retail Investors Driving XRP’s Potential Rally
Data from Coinglass shows that retail investors are showing strong confidence in XRP, reflected in positive trends in Funding Rate and Open Interest across multiple exchanges.
A positive Funding Rate suggests that traders in long positions are paying fees to those in short positions, typically signaling high demand for long positions.
Additionally, there has been a notable uptick in Open Interest, with a 1.15% increase over the last 24 hours, indicating a growing number of traders entering long positions.
Despite indications of an imminent upward move, there is a looming risk of a downturn.
Market dynamics point to larger investors, known as “whales,” reducing their holdings, coupled with a notable trend of long trader liquidations.
Whale Activities as Potential Precursors to Sell-Offs
Lookonchain data reveals that several whales have been transferring substantial amounts of XRP from private wallets to exchange wallets, a move often signaling an intent to sell and potentially driving prices down.
Recent transactions exemplify this trend, with one whale transferring 28,000,000 XRP (equivalent to $14,985,739) to the Bitso exchange, and another moving 18,820,000 XRP (valued at $10,113,389) to Bitstamp.
If these sell-offs persist, XRP might retreat to the support level of the symmetrical triangle, where previous buying pressure has been significant.
However, a failure at this support level could lead to a further price decline for XRP.