XRP defends $0.46 yet again, but here’s the ‘but’ of it all
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- The market structure of XRP was technically bearish as buyers continued to show weakness on the daily chart.
- The lack of accumulation in recent weeks showed that further losses were possible.
XRP was trading in a zone of support from late April. It was clear that buyers have been desperate to defend the $0.45-$0.47 support zone over the past month. Yet, the bulls have wearied. Evidence for this was the weaker and weaker reaction XRP saw from the support zone.
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Apart from the bearish leaning price action, the on-chain metrics also showed that buyers lacked conviction. Network-wide accumulation was absent. Hence, XRP could be slow to react positively if Bitcoin [BTC] saw a surge higher.
XRP bulls continue to defend the $0.46 level but are getting pushed further south
The 1-day price chart of XRP showed that the market structure was bullish in early June. Thereafter, buyers were unable to keep pace with the repeated waves of selling in the $0.5-$0.52 zone that commenced from 5 June. This saw XRP drop to $0.456 on 16 June, technically a higher low.
Two weeks later XRP dipped to the $0.449 mark on 28 June, while also forming a lower high with a candlewick to the $0.527 mark. This flipped the structure bearish, highlighting the dominance of sellers in recent weeks. The OBV has also been in a slow downtrend since early June. The RSI has been moving below the neutral 50 line since mid-June, showing bearish momentum as well.
The $0.45-$0.47 zone has been significant since April and was likely to serve as support again. Each bounce from this level formed a lower high, underlining weakness from the buyers. This could see the price drop to $0.41 if the $0.45 support was breached.
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XRP metrics showed it was undervalued but bulls were not yet ready
Santiment data showed that the 90-day MVRV ratio was negative. This showed the asset was slightly undervalued, but it was not enough to convince buyers to accumulate XRP. Instead, the 90-day mean coin age has been in a downtrend since late May.
This was a sign of sustained selling and pointed toward a downtrend for XRP in the coming weeks. The dormant circulation has been quiet over the past ten days, but traders can keep an eye on the metric as a large spike would point toward increased selling activity.