XRP, once riding high on bullish sentiment, has taken a dramatic turn south, sending shockwaves through the cryptocurrency market. Despite initial optimism and a failed attempt to reclaim the $0.66 level, the digital asset has nosedived, breaching both the $0.55 and $0.50 support levels within days.
Technical indicators are painting a mixed picture. While the candlestick formations still hint at bullish potential, the prevailing trend is undeniably bearish. Immediate resistance is pegged at $0.50, with a subsequent hurdle at $0.55. The cryptocurrency has shed a staggering 30% from its July peak, translating to weekly losses exceeding 25%. This price slump has concurrently boosted average trading volume to over $2.8 billion.
External Factors Cast Long Shadow
The broader cryptocurrency landscape is also influencing XRP’s trajectory. The ongoing Ripple vs. SEC legal battle continues to be a focal point, with a lawyer supporting Ripple and XRP expressing concerns about a potential Kamala Harris presidency for the crypto industry. Conversely, many industry leaders are backing Donald Trump, anticipating a more favorable regulatory environment for Bitcoin and altcoins.
Meanwhile, Ripple‘s ambitious plans to tokenize U.S. treasuries on the XRP Ledger appear to be at odds with declining on-chain activity. Transaction volume plummeted by over 65% in Q2 2024, likely due to increased transaction costs.
Price Analysis A Battleground for Bulls and Bears
XRP’s price action is currently a battleground for bulls and bears. Aggressive traders are leaning bearish, capitalizing on upward price movements to short the asset with a target of $0.40. This strategy hinges on the inability of the cryptocurrency to reclaim the $0.52 level.
Also Read: Ripple Unlocks 1 Billion XRP, Prepares $110M Sell-Off – XRP Price Crash Incoming?
The critical support zone lies between $0.44 and $0.50, a Fibonacci retracement level. A decisive break above $0.62 would signal a resurgence of the July 14-21 bull run, potentially propelling XRP to $0.66 or even $0.74. However, if sellers maintain the upper hand, a descent to $0.40, erasing all of July’s gains, cannot be ruled out.
The coming days will be crucial in determining XRP’s next move. Investors and traders alike are closely monitoring price action, technical indicators, and external factors for clues about the cryptocurrency’s future direction.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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