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Highlights
- XRP price shows a short-term correction, pushing it into a rangebound movement.
- On-chain data shows whales sold Ripple’s native crypto token on the recent 30% move.
- Rejection at the $0.613 resistance level could trigger a 10% correction to the $0.560 to $0.555 support zone.
Ripple (XRP) price rallied 30% last week due to the favorable conclusion to the SEC vs. Ripple lawsuit that began in December 2020. Despite the recent uptick in XRP price, the chances of a correction have spiked as whales dump a massive stack of XRP tokens. As a result, investors should be cautious of a potential correction in XRP value in the coming days.
XRP Price Likely To Slide Lower
XRP price shot up 30% on August 7 and set up a swing high of $0.644, lower than the July 30 local top of $0.658. From a market structure standpoint, this lower high sends a message that the buyers could not propel the token higher, aka lack of demand. As a result, Ripple price has dropped 9% since the $0.644 swing high.
As XRP price exchanges hands at $0.585, investors can expect the 30% rally to come undone soon.
A start-of-the-week rally could push XRP, a remittance token, to retest the $0.613 resistance level. Rejection here would be a sign that buyers are exhausted. Such a signal would hint at a nearly 10% correction to the $0.560 to $0.555 support range.
On-chain Data Suggests Bearish Outlook for Ripple
While the technical perspective suggests a bearish outlook for XRP price, the on-chain data confirms it. Santiment’s Supply Distribution By Balance metric shows that wallets holding 1 million to 10 million XRP accumulated 230 million tokens from July 17 to August 2, anticipating a positive outcome of the SEC vs. Ripple lawsuit.
The same wallets started booking profits and offloading their tokens, and as of August 7, their balance reached a low of 3.8 billion after dumping 150 million XRP.
Additionally, the Whale Transaction Count indicator corroborates this movement, which tracks transfers worth $100,000 or more. This metric spiked on August 7, when the XRP price shot up 30%, indicating that these whales were selling.
The technical and on-chain data hint that institutional investors sold their holdings after the conclusion of the SEC vs. Ripple lawsuit. While a short-term correction is likely, it could be undone if Bitcoin price continues to move higher.
Such a development could interest buyers and propel the XRP price above the $0.613 critical resistance level. Flipping this barrier into a support floor could attract bullish momentum and potentially propel XRP to $0.655m, the next key hurdle.
Read more: Ripple Stablecoin RLUSD Private Beta Live On XRP Ledger & Ethereum Mainnet
Frequently Asked Questions (FAQs)
1. When did SEC vs. Ripple Lawsuit reach conclusion?
2. What happened to Ripple (XRP) price after the SEC lawsuit conclusion?
3. What does on-chain data suggest about XRP price outlook?
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