- Ripple ricochets from the 38.2% Fibonacci level support.
- XRP could benefit from Tesla’s move to put Bitcoin payments on pause.
Ripple’s value dropped in tandem with other major cryptocurrencies from highs around $1.55 to $1.2. The sharp selloff occurred while investors responded to Tesla’s decision to halt Bitcoin payments. According to the largest manufacturer of electric vehicles, Bitcoin mining uses a lot of fossil fuels like coal, which are the most significant contributors to environmental pollution.
On the other hand, Ripple is a pre-mined cryptocurrency that does not consume any electric power in mining. Therefore, Ripple is likely to use the move by Tesla to push for the acceptance of its token XRP as the alternative to proof-of-work (PoS) crypto assets like Bitcoin.
Ripple resumes the uptrend toward $2
The leading cross-border money transfer token held firmly to support at $1.2; thus, allowing investors to come in at a lower price. The 38.2% Fibonacci level also strengthened the support.
Meanwhile, Ripple is trading at $1.36 while battling the immediate hurdle at the 50% Fibo. Bulls look forward to settling above this level, a move that would project the bulls’ eyes to higher levels at $1.6.
The Relative Strength Index (RSI) has recoiled from the oversold region and is closing the midline gap. This shows that the bullish grip is becoming stronger as more buyers stream in from the sidelines. A break above the 50% Fibo and $1.4 is required to validate the uptrend.
XRP/USD four-hour chart
The market value realized value (MVRV) model still has a bullish outlook. Santiment explains that this metric tracks the average loss or profit of XRP holders with tokens moved over the last 30-days compared to the price at which each of the tokens last moved.
Ripple MVRV model
Currently, the MVRV ratio holds at -8.4%, indicating that most holders are at a loss. In other words, investors prefer not to sell at a loss; therefore, they are inclined to hold and wait for the price to recover. The bullish signal implies that Ripple is in a buy zone.
It is worth noting that the resistance at the 50% Fibonacci level cannot be ignored. If not broken soon, overhead pressure will start to mount. On the downside, every time the support at $1.2 is tested, it weakens. Therefore, another retreat could crack its way to $1 and perhaps $0.85.