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Posted:
- XRP fell 2% in the last 24 hours and liquidation remained high.
- The metrics seemed bearish, but a few market indicators remained in favor of the token.
Ripple [XRP] has witnessed multiple price corrections lately as both the daily and weekly charts were painted red. Taking into account the latest data, the token’s price could drop to a key support level before rising again.
To better understand the scenario, AMBCrypto took a closer look at the state of the token.
XRP has a number of concerns
Over the past seven days, the price of XRP has fallen by more than 3%. In fact, according to CoinMarketCapThe value of XRP fell by more than 2% in the last 24 hours alone.
At the time of writing, it was trading at $0.6066 with a market cap of over $32.67 billion.
As the price of the token plummeted, volume increased, legitimizing the downtrend. However, the price of the token could fall further, as indicated by crypto analyst Ali via X (formerly Twitter).
$XRP moves within an ascending parallel channel! After rejection at the centerline of the canal, #XRP could see a pullback to the lower bound, around $0.55. pic.twitter.com/1lfCDOAXur
— Ali (@ali_charts) December 17, 2023
Ali noted that XRP was moving within an ascending parallel channel. If the pattern is to be taken into account, the token could drop to $0.55 before bouncing back from that level.
AMBCrypto then looked at XRP liquidation levels to understand at which points the liquidation occurred sign witnessed a sell-off. According to our analysis, XRP liquidation rose substantially around $0.644, after which the price started to decline.
Another mild liquidation occurred at $0.624.
However, the good news was that the token also has a key support level at $0.59. If it manages to test that level, XRP may not fall to $0.55.
Source: Hyblock Capital
It was interesting to note that as the price of the token plummeted, negative sentiment surrounding the token increased, as evidenced by the dip in weighted sentiment.
Nevertheless, its social dominance remained high throughout the week, clearly reflecting its popularity in the crypto space.
Source: Santiment
Possibilities of XRP going further down
AMBCrypto’s look at Santiment’s data revealed that XRP’s MVRV ratio plummeted last week. Network growth also transitioned, meaning fewer new addresses were being created to transfer the token at the time of writing.
At the same time, XRP’s Binance Funding Rate remained in the green as its price plummeted. This suggested that derivatives investors were actively buying the shares sign at the lower price, increasing the chance of a further downward trend.
Source: Santiment
Read Ripple [XRP] Price prediction 2023-24
Anyway, AMBCrypto’s analysis of XRP‘s daily chart pointed to a few positive indicators. In particular, the Bollinger Bands indicated that the price of XRP had entered a less volatile zone and was at a minimum chance of a major price drop.
The Money Flow Index (MFI) also registered a slight increase, showing the possibility of an impending trend reversal.
Source: TradingView