XRP Steep Decline: Worst Weekly Performance Since August 2023
One of the leading cryptocurrencies, XRP (XRP), logged a low performance on November 17, marking its worst weekly performance since August 2023. The currency’s price has dropped to around $0.60, marking a significant 9.5% downfall in a week, including a 7.5% decline in just the past 24 hours.
Interestingly, this downtrend is a reflection of the behavior observed across most top-notch cryptocurrencies. However, XRP has notably underperformed in the broader crypto market, which only fell by about 2.5% this week.
The Underlying Factors
BlackRock’s XRP ETF Rumor
Substantial market dynamics unfolded across the period leading up to November 17. One noteworthy event was a rumored BlackRock exchange-traded product (ETF) centered around XRP, which caused the cryptocurrency’s price to spike 12% to around $0.75 on November 13. However, this rumor was later discounted, resulting in a swift drop back to its initial value on the day. This sharp swing primarily affected those holding long positions, and there was a massive liquidation in XRP price.
XRP Whale Distribution
A modest drop in the holdings of the wealthiest XRP addresses was another contributing factor to XRP’s price weakness. For instance, the supply held by addresses with a balance between 100,000 XRP and 100 million XRP observed a slight drop after the BlackRock ETF rumor. Furthermore, the holdings of addresses with a balance between 100 million and 1 billion XRP witnessed a marginal growth of 0.11%.
Furthermore, XRP’s decline appears to be part of a correction that began after testing a historical resistance trendline near $0.75. Moreover, the downtrend is also a correction from overbought conditions that had emerged around November 6 when XRP’s daily relative strength index (RSI) reached its highest levels since July 2023. Traditionally, “overbought” RSI is followed by selloffs.
Is There Light at the End of the Tunnel?
Despite the decline, experts believe that this is a typical bull market correction, and there’s a strong possibility that the general uptrend may resume. XRP/USD has been fluctuating inside an ascending channel since June 2022. As of November 2023, the cryptocurrency entered a correction period after testing the upper trendline of the channel as resistance.
From a technical standpoint, it now risks a decline towards the lower trendline near $0.50, marking a downturn of 18.5% from the current price levels. Interestingly, this downside target coincides with XRP’s 50-week and 200-week exponential moving averages (EMAs).
However, if a decisive breakout surpasses the current resistance level near $0.75, XRP price might shoot towards $1.13 in 2023 or early 2024, marking an 80% increase from current price levels.
In conclusion, the current climate of the market does not guarantee a specific upward or downward trend for XRP. As with any other form of investment, it carries a certain level of risk. Therefore, prospective investors should conduct thorough research before making any investment decisions.