Ripple’s XRP seems to be transitioning from upward movement to a downward trend amidst the current market volatility.
As of this moment, the asset has seen a 5% price decline, breaking through its longstanding support level and signaling a potential significant drop in price.
XRP’s Analysis and Forecast
As per the technical analysis by CryptoCrypto, XRP has turned bearish on the four-hour chart following a breakdown from an ascending triangle formation.
This breakdown led to the breach of the critical $2.50 support level. The violation of both horizontal support and triangle price action indicates a possible notable decrease in XRP’s value.
Considering recent price movements, if XRP closes a four-hour candle below $2.50, there is a high likelihood of a 13% decline towards the $2.10 level in the near future.
Moreover, XRP’s Average Directional Index (ADX) stood at 20, indicating weak momentum, further reinforcing the bearish scenario.
Current Price Trends
At the current time, XRP is being traded around $2.45, experiencing a more than 5% drop in the last 24 hours. However, its trading volume has surged by 70% during the same period.
This surge suggests increased engagement from traders and investors compared to the previous day.
An uptick in trading volume does not necessarily signal a bullish trend but reflects both bullish and bearish activities such as liquidations, accumulation, and selling of tokens.
Sentiment Analysis and On-chain Data
Reviewing the current market sentiment, it appears that investors and holders are accumulating XRP, according to on-chain analytics firm Coinglass.
Data from Spot Inflow/Outflow revealed an outflow of more than $13.65 million worth of XRP tokens within the past 24 hours.
This outflow suggests potential accumulation that could drive upward momentum and increase buying pressure.
Despite this, the prevailing market sentiment indicates that this may not be sufficient to trigger a significant rally in XRP.
XRP Traders’ Leveraged Positions
Alongside the optimistic stance from long-term holders, the notable liquidation levels at present are $2.40 on the downside and $2.55 on the upside.
Coinglass data indicates that traders are over-leveraged at these levels.
If the market sentiment remains unchanged and the price falls below $2.40, long positions worth around $35.50 million may face liquidation. Conversely, if sentiment shifts and the price climbs to $2.55, short positions worth over $40 million could be liquidated.
These metrics from on-chain data and technical analysis indicate a current market dominance by bears, potentially leading to a further decline in XRP’s value in the upcoming days.