Is XRP in the Danger Zone? Could XRP Price Drop to Zero?
XRP price could be in danger as the asset broke below a key support level. With the ongoing legal battles and regulatory scrutiny against Ripple, investors are left questioning whether XRP could drop to zero. The increasing market volatility caused by Bitcoin’s price dropping below $67,000 has not helped the situation.
The price of XRP hovered around $0.5289 during the New York trading session, a 3% drop in the last 24 hours. This decline also marks a weekly low for the asset, contributing to the growing panic among XRP investors.
Overall, the crypto market is down 2.6%, which could be a contributing factor to Ripple price performance. The question remains: Could the price of XRP drop to zero?
Why Is XRP Price In The Danger Zone
The market has become overwhelmingly bearish on XRP, as both on-chain metrics and trader behavior statistics suggest that traders are selling or preparing to sell.
According to Santiment data, XRP profitability fell overall between Oct.14 and Oct. 23. The ratio of daily on-chain transaction volume in profit to Loss fell from 2.7 to 1.27. This means that for every transaction made on the XRP Ledger, 1.27 end up in profit, a 47% drop in a week.
Additionally, the percentage of XRP coins in profit dropped from 79% on Oct. 21 to 74% on Oct. 23. This suggests that XRP investors are making losses and are likely selling their bags to prevent further losses.
The 7-day Liquidation Map from Coinglass confirms this bearish thesis as traders have opened $76 million Shorts against $34 million Longs on Binance, OKX, and Bybit. This imbalance suggests a bearish sentiment dominates the market as traders anticipate a further decline in XRP price.
Despite the bearish sentiment, analysts remain adamantly bullish on XRP, even calling for a $16 Ripple price tag in the coming weeks and months.
Will Ripple Price Drop to Zero?
While the XRP price is in a bearish trend, it is unlikely to drop to zero. The price is in a short-term downward trend after breaking down from the rising wedge formation. Following this breakdown, the price shows signs of weakness, and the steep drop indicates strong selling pressure.
The candlestick patterns confirm the strong bearish momentum, signaling that sellers have dominated the market, pushing the price of XRP below the rising wedge. The rising wedge was also part of a bear flag, a bearish continuation pattern.
On the way down, XRP will likely find support around the $0.50 – $0.505 range and lower, near the $0.43 – $0.435 range. This will mark an 18% drop from the current price. Additionally, this region may mark the final significant support area before the market looks for a reversal or stabilization.
XRP Price Chart
The bottom of the rising channel (~$0.545 – $0.550) now acts as strong resistance. If the XRP price attempts a rally, this zone could reject it. However, if market conditions change, the price could return to the rising channel, and the current breakdown would be ruled off as a fake out, invalidating the bearish thesis.
The Relative Strength Index (RSI) is sitting at 39.43, near the oversold territory, suggesting that while there is downward pressure, a potential bounce could occur if the price reaches oversold conditions near the projected target.
The SEC v. Ripple lawsuit is a major contributor to the price movement of XRP, and now, with the recent $10 million XRP donation to VP Kamala Harris, Ripple may be intertwined with the already hot U.S. election campaigns.
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Filed under: News - @ October 23, 2024 10:24 am