XRP's Value Dips with Possibility of Further Decrease, Yet Future Holds Potential Recovery
Summary:
The cryptocurrency XRP has seen a significant decrease in value, dropping 18.5% from a peak of $0.67 on November 23rd. Predictions show a potential 20% further decrease before 2024 due to enduring selling pressure, an increase in supply at crypto exchanges and recent outflows from XRP-related institutional investments. Despite this decline, XRP's general upward trend remains steady with predictions of a comeback in the coming years.
The value of cryptocurrency XRP has experienced a significant decrease of 18.5% from its local peak of $0.67 on November 23rd, and it is predicted that further devaluation might occur in the succeeding weeks.
Looking at XRP's performance over the years, the cryptocurrency has been unsuccessful in surpassing a downward-trending resistance since the beginning of 2018, and this trend continued in November 2023. This longstanding inability to break through suggests an enduring disinclination to sell the digital asset at upper-level prices.
In previous occurrences of failing to exceed this descended resistance, the value typically retreats to an ascending trendline of support. There is a high likelihood that XRP's value may depreciate to around $0.50, coincidentally aligning with XRP's 50-week and 200-week exponential moving averages known as the red and blue waves, respectively. Consequently, a potential decrease in XRP's price value by 20% may be seen before the onset of 2024.
Further validation can be found in the distribution data of XRP supply, held by addresses containing between 1 billion and an infinite sum of tokens, having increased by 1.75% since November 20th. It is believed that a large amount of these addresses are owned by crypto exchanges, a strong indicator of the investor propensity to transfer XRP to trading platforms primarily for sales purposes.
Historically, there are cases showing substantial and minor price drops succeeding a surge in the supply of the 1 billion-infinity XRP tokens. In reverse, a decrease in the cohort's supply, pointing to outflows from exchanges, led to an increase in XRP's price value from $0.55 to $0.68.
Institutional investor behavior further corroborates a decrease in XRP holdings, with investment vehicles linked to XRP observing outflows amounting to $2.6 million in November, as reported by CoinShares. During this time, other cryptocurrencies noted increases in inflow, with Bitcoin taking the lead.
Despite the drop in price, XRP experienced an 80% return for investors by November 23rd in 2023, driven by its partial legal victory against the U.S. Securities and Exchange Commission and the subsequent enthusiasm for the Spot Bitcoin ETF. Consequently, the drop in XRP's price can be viewed as a bull market correction, with investors securing profits by selling XRP at its local price peaks. Nonetheless, it is important to note that this does not impact XRP's overall upward trend.
In line with the current market data, trading experts predict that XRP will bounce back, with Muro projecting a 30% increase to $0.80, while CryptoBull forecasts a value of $4.20 for XRP in 2024 premised on its history of breakouts following periods of consolidation within triangle patterns.
Please be advised to conduct proper research and be aware of potential risks before making any investment or trading decision, as the current article does not provide investment advice or recommendations.
Published At
11/23/2023 7:53:44 PM
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