The recent price movements of XRP have generated considerable interest, especially regarding whale activity observed during its decline.
The surge in the digital asset’s value to $2.43, accompanied by noticeable patterns of whale accumulation, has raised questions about the sustainability of its upward trend and the potential impact on smaller investors.
Whales Take Advantage of XRP Surge
An analysis of Santiment data by CryptoCrypto has shown that XRP whales—wallets holding between 1 million and 10 million coins—have augmented their holdings amid price fluctuations.
While XRP experienced a drop from $2.90 to $2.22, whales acquired over 120 million XRP, amounting to $288 million. Traditionally, such whale activity during price declines has indicated confidence in the asset’s long-term viability.
Examining the historical context reveals that whale accumulation often precedes positive price movements, as witnessed during notable XRP rallies in 2021 and mid-2023.
According to CryptoCrypto’s scrutiny of the MVRV metric, the previous spike in accumulation coincided with a negative ratio, indicating that whales purchased and retained assets at a loss, with the MVRV hovering around -30% at that time.
However, the current situation displays a more substantial disparity. Despite whale accumulation, the 30-day MVRV ratio stood at approximately 39.66%, signifying that XRP remained in an overvalued state.
This ratio implies that profits were higher than usual, making the asset susceptible to short-term profit-taking actions.
Analyzing Price Trends and Technical Signals
Observing XRP’s price chart reveals a consistent upward trajectory, with the RSI hitting 74, indicating overbought conditions. Additionally, the MACD demonstrated bullish momentum, supported by a positive crossover.
Despite these optimistic indicators, the asset’s uptrend might encounter obstacles near the $2.50 mark due to increased selling pressure. At the time of writing, XRP was trading around $2.55, showing a minor recovery.
A review of past whale activities during declines showcases varied outcomes.
For example, whales that accumulated during downturns in early 2021 reaped substantial profits as XRP surged, while those who bought during the mid-2023 dip endured prolonged stagnation before witnessing a rebound.
Market Sentiment and Broader Context
The overall market sentiment plays a critical role in determining whether whale accumulation can sustain XRP’s upward momentum.
If whale acquisitions persist in driving demand, combined with favorable macroeconomic conditions, XRP could potentially challenge its next resistance thresholds.
Conversely, profit-taking by whales or a shift in general market sentiment might trigger a consolidation phase or correction.
Historical trends and current on-chain data suggest a mixed outlook, with bullish prospects moderated by the likelihood of a short-term pullback.