Ripple’s XRP has surged by an impressive 518% since November, drawing significant attention and adoption due to these substantial gains for a token already established as a major player in the cryptocurrency market.
The increased number of addresses on the XRP Ledger indicates a consistent growth trajectory and growing confidence in the network.
XRP Sees a 17% Rebound from Recent Lows
Over the past week, XRP, along with the broader crypto market, experienced heightened levels of volatility. While XRP has been trending upward on higher timeframes since November, the lower timeframes have exhibited a bearish sentiment.
Observing the 6-hour price action, it becomes apparent that the token currently demonstrates a bearish market structure after dropping below the previous low at $2.95.
Additionally, the On-Balance Volume (OBV) indicator has shown lower highs and lower lows in the latter part of January, indicating a lack of accumulation and hinting more towards distribution during the retracement from $3.4.
Despite the recent 17% price recovery from $2.655 within the last 24 hours, the bearish scenario remains stronger in the short term. With the Relative Strength Index (RSI) hovering around 52.5, just above the neutral 50 level, control of the market still predominantly lies with the bears on lower timeframes, advising traders to act cautiously.
On-chain metrics, however, depict some bullish signs. Despite the price decline on January 27th, there has been minimal movement in the number of dormant coins over the past week, suggestive of a lack of significant selling pressure.
Furthermore, the mean coin age has continued to rise despite the recent price drop, indicating a consistent accumulation of XRP tokens by investors.
Hence, there is a high probability that XRP could surpass the $3.2 resistance level in the near future.
The 30-day Market-Value-to-Realized-Value (MVRV) ratio remains positive, potentially triggering profit-taking by short-term holders and leading to a gradual decline in XRP’s price over the following days before another bullish swing takes place.
Disclaimer: The views expressed herein do not constitute financial, investment, trading, or any other form of advice and are solely the opinion of the author.