Ripple (XRP) cleared $0.45 for the first time since November 2022. However, a closer look at some key on-chain data reveals a selling trend among whale investors. How far can XRP retrace in the coming weeks?
Retail investors are buying after the recent rally in prices, but whale investors are seen booking profits.
Ripple (XRP) recorded a price increase of 27% on March 21. The price rise was mainly attributed to buying pressure among investors ahead of a possible victory in the Ripple vs SEC case.
Ripple published a notice citing a recent US Supreme Court ruling regarding Binance.US causing the XRP price to jump. The judge summarily rejected the SEC’s claims to label Voyager’s VGX token as a ‘security’ and BinanceUS, an unregistered securities exchange.
XRP whale selling, among other on-chain metrics, suggests an imminent price correction amid positive market reaction.
According to Sentiment, a strategic group of whales have unloaded nearly $140 million worth of XRP coins in the past two weeks.
Between March 9 and March 27, a strategic group of whales sold over 300 million XRP worth approximately $141 million.
XRP holders should be wary of a possible decline in the coming weeks, given the recent history of price declines in the 10 million to 100 million XRP whale cluster.
Similarly, the recent Ripple notice has sent the positive sentiment surrounding XRP to euphoric levels. According to Sentiment, XRP has recently risen to the top of trend tables across various crypto media channels.
As shown by the red line below, XRP social dominance nearly doubled between March 13 and March 27, rising from 0.94% to 1.78%.
When social dominance reaches a local level, it usually indicates a bullish mood among token holders and network participants. This could result in an XRP selling frenzy as savvy crypto investors seek to sell at the top.
XRP Price Prediction: $0.50 Is a Major Road Block
Market-value-to-realized-value (MVRV) is an important indicator of XRP’s potential price movement. According to Sentiment, it compares the ratio of an asset’s market capitalization to its realized capitalization.
The MVRV chart below shows that most holders who bought XRP coin over the past 30 days are sitting on profits of around 15%. Historical data shows that XRP holders often sell until the price reaches the 6% profit zone, where they can initiate positions for future gains.
Therefore, they will continue to sell until the price drops to $0.42. If this support line doesn’t hold, they can sell until XRP reaches the 5% loss line at $0.35, where they would want to cut their losses.
Nevertheless, if XRP breaks out of the current bearish outlook, it could reach the 22% zone at $0.50. But if it scales this resistance point, then $0.60 is the next major bullish market where holders can start taking profits.
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