Back above $3: Here’s why XRP’s recovery can lead to a new ATH
Following the Fed Chair's comments, stocks and crypto markets saw sizeable short-term gains, impacting XRP.
Key Takeaways
XRP’s momentum reversal was accompanied by accumulation that rivaled levels from February, reflecting bullish conviction from holders. The altcoin could rally above $3.4 to new all-time highs next.
Ripple [XRP] was able to rebound from the $2.7-$2.8 support zone for the second time in August following a market-wide sentiment shift.
At the same time, on the 22nd of August, Fed Chair Jerome Powell hinted at the possibility of rate cuts.
The Fed Watch Tool showed the market believed there is a 75% chance of a rate cut in September.
The Chair’s speech at Jackson Hole, Wyoming, came close to endorsing a rate cut, and the market gleefully embraced this news.
The Dow Jones Industrial Average showed a gain of 600 points, and took the crypto markets higher. Bitcoin [BTC] rose strongly from the $111.6k depths to $116.3k, a 4.2% move.
Ethereum [ETH] also saw a swift bullish response, gaining 14.87% to reach $4,833 in a matter of hours.
In a post on X, crypto analyst Ali Martinez observed that the TD Sequential indicator presented a buy signal for XRP. This came a few hours before the market-wide rally, catching the local bottom.
The altcoin was back above the $3 mark at press time, and would be looking to charge toward the range highs at $3.4 next. AMBCrypto found some signs that this rally could achieve a breakout.
Accumulation gathers speed, XRP prices could follow
The exchange net position change turned deeply negative in the second half of August. The magnitude rivaled that of the change from February.
Negative position change on exchanges reflects reduced supply held in exchange wallets, implying accumulation from holders.
This was positive news for holders, and it reflected market expectations that XRP could go even higher in the coming weeks and months.
In the near-term, the outlook flipped bullishly for XRP after it beat the lower high at $2.98. XRP also climbed past the 20 and 50-period moving averages, which were yet to catch up with the momentum reversal.
The CMF climbed above +0.05 to indicate sizeable capital inflow to the market. If XRP bulls can hold the $2.95 demand zone, a rally toward the $3.4 resistance would be likely.
