XRP price has kept investors on their toes lately, stuck in a tight range that has frustrated many. It’s down roughly 18% over the past month and nearly 4% just in the last 24 hours. However, signs are beginning to surface that could indicate a potential bounce, and this time it might have the support to hold.
In this analysis, we’ll explore clues pointing towards a possible XRP price bounce, examining market signals, holder behavior, and what levels traders should watch closely. If you’re intrigued by where XRP might be headed, keep reading to uncover the hints that suggest a shift is on the horizon.
A New Signal Indicates Buyers Could Be Back
XRP has been wobbling between $2.28 and $1.98 since late November. This stalemate between buyers and sellers has felt stagnant, but a recent price activity provides a fresh perspective. The price recently touched the lower boundary of a symmetrical triangle, which often serves as a precursor to significant moves when buyers and sellers are temporarily balanced.
Volume Trends: Hidden Accumulation or Just Noise?
A critical clue appears in the volume movement between December 6 and December 11. During this time, XRP recorded a lower price low while the On-Balance Volume (OBV) registered a higher low. This discrepancy suggests underlying accumulation, hinting that despite the price decline, some investors are busy buying the dips. Such a situation often precedes a bounce when others expect movement.
The OBV indicates the flow of volume in relation to price movements. A rising OBV alongside a price drop signals that accumulation is happening, creating a potential foundation for a bullish rebound. This early buying pressure, showcased by the combination of the triangle’s support and OBV divergence, indicates that appetite may be returning to the market.
Long-Term Holders: Are They Retreating?
Another key factor in this scenario is the selling behavior of long-term XRP holders, who generally have a more significant impact on price stability. Data shows that on December 3, these holders sold off 101,083,156 XRP. Fast forward to December 10, and that number plummeted to 51,157,301 XRP—a staggering reduction of around 49%. While they remain net sellers, the retreating selling pressure sets the stage for a more sustainable bounce.
Why This Bounce Could Have Strength
For a price bounce to hold its ground, it requires both a reduction in selling pressure and a shift in market dynamics. As long-term holders are tapering off their selling habits, interest from speculative buyers also seems to be dwindling. Typically, short-term holders rush to sell into any uptick, but a recent shift in the market shows they are less inclined to do so.
Fast-Moving Wallets: Cutting Supply
Those short-term XRP holders typically contribute to volatility by rapidly cashing out on price increases. This time, data reveals they are selling less aggressively. For example, the 24-hour cohort held a mere 0.22% of the total supply by December 10, down from 1.89% just days before. This reduction helps indicate a decrease in speculative pressure that often undermines rebounds, enabling the price to stabilize more effectively.
Long-Term and Short-Term Dynamics at Play
Interestingly, the cohort holding XRP for one day to one week peaked at 3.88% on December 4, then dropped to 1.24% by December 10. This pattern minimizes the likelihood of speculative sell-offs that typically accompany price bounces, allowing for more sustainable growth as less supply floods the market during upward movements.
Key XRP Price Levels to Watch
Currently, XRP trades near the crucial $2.00 mark, just within the wider $2.28 to $1.98 brackets. To fortify any potential bounce, XRP needs to decisively clear the $2.17 mark, about 8.37% higher. A close above this price would enhance the odds of testing the upper range, opening doors for higher targets.
Confirmation Points for Traders
A breakout above $2.28 would confirm that the price has indeed broken free from its consolidation phase, allowing XRP to target new highs. However, traders should also keep an eye on downside risks. A daily close below $1.98 could signal trouble ahead and might suggest a drop toward the next major support level at $1.88.
What’s Next
As XRP navigates through this critical juncture, the emerging clues point toward a potential bounce, though traders should remain cautious. Decreasing selling pressure from long-term and short-term holders alike creates an environment conducive to a bounce, while charts provide important levels for traders to monitor. Understanding these dynamics can aid in making informed decisions as the XRP landscape continues to evolve.
