XRP Price Drops as investors React to Powell's Hawkish Remarks
Summary:
XRP price declines as investors de-risk after Fed Chair Jerome Powell's hawkish remarks at Jackson Hole. Whales reduce XRP exposure while technical analysis suggests potential losses ahead. Mixed sentiment on rate guidance. Article does not provide investment advice.
XRP (XRP) price is experiencing a decline today, following a trend seen across the cryptocurrency market. This comes as investors adopt a more cautious approach in response to Federal Reserve Chairman Jerome Powell's hawkish statements at the Jackson Hole symposium.
There has been a 1.25% drop in the value of XRP on August 25, with the cryptocurrency trading at $0.507. Although the overall crypto market capitalization also declined by 1% during this period, XRP slightly underperformed. Additionally, the U.S. dollar index (DXY) reached a two-month high, suggesting that investors are increasingly seeking safer investment options.
The market sentiment surrounding the future of interest rates remains mixed. According to the CME FedWatch Tool, there is a strong expectation of a rate pause in September. However, the probability of a rate hike in November has increased from 32% to 41% over the past month.
The days leading up to Powell's speech saw significant reductions in XRP holdings by large investors. The supply held by addresses with balances of over 1 billion tokens decreased from 41% to 39.21% over the course of a week. Similarly, the supply held by entities with balances between 10 million and 100 million tokens dropped by 0.25% in the last four days. Notably, a prominent XRP investor moved 29.3 million XRP, equivalent to $15.13 million, to the Bitstamp exchange, potentially increasing selling pressure.
Looking ahead, there are potential further losses for the XRP/USD pair in the days or weeks to come. The ongoing consolidation trend for XRP suggests the formation of a bear flag pattern, which often indicates a bearish continuation. If the price breaks below the lower trendline, there could be a significant decline of as much as the height of the flagpole, potentially resulting in a flash crash towards $0.40. This would imply a 20% price decline by September.
However, bullish investors may find hope in XRP's daily relative strength potentially turning oversold, which could lead to a short-term recovery towards the upper trendline of the flag. In such a scenario, XRP could target $0.54 by the end of August, representing a 6% gain.
Please note that this article does not provide investment advice or recommendations. Investors should conduct their own research and analysis before making any investment decisions.
Published At
8/25/2023 4:28:28 PM
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