Ripple Price Analysis: XRP Holds Within the Buy Zone, Ignoring the Quagmire at $1

2 Min Read
Last Updated July 23rd 2021
  • Ripple retest support at $0.9 after losing the tussle above $1.
  • The profit or loss ratio gradual recovery attracts more investors to join the market.
  • Declining network growth is a bearish signal likely to sabotage the uptrend above $1.
  • Ripple lost some ground after suffering a rejection above $1 on Wednesday. Support has been secured at $0.9 on the downside, allowing bulls to champion another recovery attempt. In the meantime, XRP trades at $0.99 while buyers deal with the seller congestion at the 50 Simple Moving Average (SMA) on the four-hour chart.

    Ripple eyes liftoff to $2

    The international money transfer token finds it challenging to sustain rice action beyond $1. As mentioned, the 50 SMA currently hinders the uptrend, delaying the recoil from the solid support at $0.9.

    Meanwhile, the Relative Strength Index (RSI) has a bullish signal, especially after holding above the midline. As the trend strength indicator moves to the overbought region, more buyers are bound to come from the sidelines, anticipating a significant upswing to levels around $2.

    XRP/USD four-hour chart

     Ripple XRP Four-Hour Chart

    It is essential to realize that a daily close past $1 is needed to ascertain bullish control and pave the way for the ultimate liftoff. Another critical milestone would be cracking the hurdle at $1.2, as highlighted by the 100 SMA.

    According to Santiment’s market value realized value on-chain model, Ripple is in an optimum buy zone. This indicator tracks the profit or loss of the holders of XRP tokens moves within the last 30 days analyzed against the price at which each previously moved.

    Following the price drop last week, the MVRV ratio plummeted to -40. This is a meager figure suggesting that most holders were at a loss. At the time of writing, the metric holds at -22 amid a progressive recovery.

    In other words, Ripple is in a buy zone accentuated by less selling pressure because holders tend to hold when the MVRV ratio is low. As more and more investors return to the market, XRP will assume the trajectory heading to $2.

    Ripple MVRV model

     Ripple XRP MVRV Model

    Looking at the other side of the fence

    Santiment’s network growth on-chain model has a bearish signal. This model follows the number of addresses joining the XRP Ledger every day. As illustrated on the chart below, a declining network growth interferes with the regular inflow and outflow of tokens, making it difficult for bulls to sustain an uptrend.

    Ripple network growth model

     Ripple Network Growth Model

    Roughly 3,900 addresses joined the network on May 26, compared to a 30-day high of nearly 8,000 recorded on May 11. It is worth noting that recovery is shaky based on the downward pointing metric. Therefore, sustaining the trend above $1 may be hard to crack, perhaps leading to another correction.

Top Brokers in
    All Regulated Brokers
    67% of retail clients lose money when trading CFDs with this provider.