The price of XRP at risk of falling above 25% in the coming weeks due to a multi-month bearish fix and fears of XRP oversupply.
XRP Descent Triangle
XRP is being condensed within a pattern of descending triangle since reaching its second highest level to date, close to $ 1.98, in April 2021.
In doing so, The XRP / USD pair left a sequence of lower highs at its upper trend line while finding a solid support level around $ 0.55, as shown in the chart below.
In the week ending 13 March, an XRP price retesting the upper trendline of the triangle as resistance, raising an alarm that the base could see another move back to the trend line support of the close $ 0.55 pattern, which is down between 25% and 30%.
The downside view is also based on another bearish catalyst that has emerged around the resistance of the triangle.
For example, XRP done a bearish hammer on March 12, a single – chandelier pattern with a small body and long curls advanced, suggesting less purchase pressure near the weekly high of coins around $ 0.85.
Also, the price turned lower after testing resistance confluence defined by its 20-week EMA (the 20-week EMA; the green wave) and its 50-week EMA (the red wave)as shown in the attached image below.
Excessive supply FUD
More negative signals for XRP occurred after Ripple Labs received 800 million XRP deposited as part of your scheduled withdrawal schedule.
The blockchain payment company moved about $ 100 million XRP worth nearly $ 40 million to exchange wallets on March 3rd. In the meantime, the remaining 700 million XRPs (worth about $ 550 million) were held in an escrow account, raising expectations by at least 200 million XRP would be released on the market to generate funds for Ripple’s operating costs, as well as distribute XRP among Ripple’s global clients.
I realized there are about 800 million $ XRP locked and ready for sale … one should check the increase in supply in circulation to verify this
– Shyan (@tayshyan) March 12, 2022
I realized there are about $ 800 million XRP locked and ready for sale … one should check the increase in supply in circulation to verify this.
An earlier reaction to the XRP price of unexpected supply increases has led to fears of a sell-off. For example, the XRP / USD pair fell more than 50% to about $ 0.60 four months after their net circulating supply rose from 40.46 billion to over 47 billion in just two days.
However, Ripple withdrawal of 800 million XRP is yet to be reflected in its net circulating supply.
Acceptance risks increase profits
Another catalyst that suggests the price of XRP could fall 25-30% to reach its downward triangle target is an indicator from Santiment that tracks social media trends and their impact on market trends.
The price of XRP is up more than 15% a week so far on March 12, Santiment notes, as well as a huge spike in social media searches for the hashtag #XRPNetwork., suggesting that it may continue with possible future liquidation. Quotes:
“Historically, our social trends suggest that making a profit is justified when the crowd makes #XRPNetwork mainstream.”
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