After a significant surge to $3.40 following a period of consolidation, Ripple’s XRP is now maintaining stability within the range of $2.30 to $2.50. Could exercising patience potentially lead to more substantial profits in the near future?
The Dilemma between Avarice and Apprehension
Having experienced a 30% decline from its peak of $3.40 in mid-January, XRP is currently witnessing a prevalence of sell orders in the perpetual market, accompanied by historically low leverage levels.
Despite Ripple not reaching an overbought status, traders in futures markets have been closing positions, indicating a dominance of greed where investors prioritize quick gains over holding for larger returns.
In the present scenario, XRP has been confined within a narrow range for the past five days. A similar setup in the previous cycle led to a prolonged consolidation period followed by a remarkable 70% surge.
If history were to repeat itself, XRP might be gearing up for a substantial rally, with the potential to reach $4.25 by the end of the first quarter. However, the question remains whether the desire for immediate profits will overshadow the fear of missing out.
With a recent 4.80% upsurge within 24 hours, indications of renewed Fear Of Missing Out (FOMO) are emerging, propelled by a general optimistic sentiment in the market as the overall crypto market cap shows a 2.35% increase, reclaiming levels seen in early February.
Despite these factors, with Bitcoin’s dominance remaining robust, one might wonder if Ripple can replicate its previous 70% breakout.
Essential Criteria for XRP’s Potential Growth
During the prior cycle, XRP’s surge beyond $3 was not accidental. It was facilitated by strategic accumulation by major investors, who injected approximately $4 billion worth of XRP into their portfolios starting from November.
Moreover, the XRP/BTC pair achieved its peak for the year as investments flooded into Ripple, primarily driven by retail FOMO. A closer look at the data suggests that Ripple could be on the verge of another substantial uptrend.
In recent times, wallets holding 10 million to 1 billion XRP acquired an additional 550 million tokens, expanding their reserves by 5.55%. This development triggered a 3.09% price increase on the following day.
Is history repeating itself? The setup indicated by the XRP/BTC pair hints at a familiar pattern, squeezing out short sellers and laying the groundwork for a potential breakout.
If this trend persists, amidst the market’s fluctuations, a potential 70% surge to $4.25 might not be too distant, emphasizing the importance of holding onto Ripple as a strategic move.