XRP Summer Showdown: Trading Hype Versus Price Reality, What Lies Ahead?
September 04 2023 - 3:30PM
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XRP, the fifth-largest cryptocurrency in the market, has entered a
phase of macro consolidation following a significant decline that
began on July 20. This consolidation has maintained the token’s
price within a range of $0.4858 and $0.5505, before Ripple Labs’
legal victory against the US Securities and Exchange Commission on
July 13. XRP Consolidation Continues Despite Strong Trading
Activity According to insights from crypto market data provider
Kaiko, XRP demonstrated extreme trade volume during the summer.
XRP’s average trade volume in the previous month reached $462
million, four times higher than the following most prominent
altcoins by trade volume. The question arises as to why XRP failed
to sustain its price gains despite its impressive trade
volume. Analyzing the average share of sell volume for XRP
provides some insights. Notably, the largest Korean exchange,
Upbit, and OKX experienced significant selling pressure, while
buying activity was more prominent on US-based Coinbase throughout
the previous month. Related Reading: Shiba Inu Whales Begin
Accumulation As Shibarium Grows Another interesting observation is
the rise in average trade size for XRP on Coinbase, surpassing all
other top ten altcoins. This suggests that buying demand may
have been driven by large traders in the United States, as
investors regained access to the token following the July court
ruling. However, it is essential to note that even though XRP
tops the list on offshore markets, its share of trading volume in
the United States remains lower, ranking it as the sixth most
traded altcoin by cumulative trade volume. Currently, XRP is
trading at $0.5063, displaying a stable price within 24 hours.
Moreover, the token has maintained a consistent consolidation
phase, experiencing a slight decrease of 2.7% and 1.4% over the
past seven and fourteen days, respectively. This raises
whether XRP’s uptrend will prevail or if further downside movements
are looming. Is A Bullish Resurgence Or Downtrend Imminent? Crypto
analyst Egrag Crypto recently took to the social media platform X
(formerly known as Twitter) to present two contrasting scenarios
for XRP’s price movement. The first scenario suggested a
potential dip to $0.43 or even $0.35, which could be seen as a
shakeout before a rebound. The second scenario proposed a more
optimistic outlook, with XRP potentially aiming for heights of
$0.60 and $0.67 before skyrocketing to new levels. To gain further
insights into the likelihood of these scenarios, it is crucial to
examine XRP’s resistance and support lines on the daily chart
above. The chart reveals that while surpassing the next resistance
level of $0.5401 and regaining bullish momentum, XRP could
potentially experience a substantial 27% uptrend toward $0.6700, as
predicted by Egrag Crypto. However, the token currently faces two
significant hurdles in achieving this. XRP’s 200-day and 50-day
Moving Averages (MAs) can act as solid resistance levels if the
token’s trading volume is not accompanied by sufficient buying
pressure. Presently, XRP is trading below these two lines, which
adds to the challenge of surpassing the resistance. If XRP fails to
overcome these resistances and sustain its consolidation phase,
another correction may soon be on the horizon for the token.
Related Reading: FTX Wallets Begin Moving Tokens One Month To Sam
Bankman-Fried’s Trial On the other hand, bullish investors will
need to defend the nearest support floor for XRP at $0.4524. If
this level is breached, the token could decline further to the
$0.3495 zone or even the $0.2854 line, representing XRP’s one-year
support. Considering the various scenarios and the resistance and
support lines depicted in the chart, the absence of catalysts that
could propel XRP to higher price territories, coupled with a failed
attempt to maintain its macro consolidation zone, may lead XRP
towards continuing its downtrend and potentially reaching a new
yearly low. Featured image from iStock, chart from TradingView.com
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