- The XRP price action was bearish, but on-chain metrics indicated that accumulation was underway.
- XRP might not succeed in overcoming the $3.2 resistance this week, but was making progress toward this goal.
Ripple [XRP] is up by 518% since November. These vast gains for a token that was already considered a large-cap coin have attracted increased attention and adoption.
The rising number of addresses on the XRP Ledger pointed toward steady growth and increased confidence in the network.
XRP rebounds 17% from local lows
Source: XRP/USDT on TradingView
XRP and the rest of the crypto market witnessed heightened volatility over the past week. XRP has been in a higher timeframe uptrend since November. However, in the lower timeframes, it has a bearish outlook.
The 6-hour price action showcased that fact. The token has a bearish market structure after falling below the previous low at $2.95.
Moreover, the OBV has made lower highs and lower lows in the second half of January. Therefore, the retracement from $3.4 was not accompanied by accumulation, but rather by distribution.
Despite the 17% price bounce from $2.655 in the past 24 hours, the bearish case was more persuasive in the near term. The RSI was at 52.5, just barely beyond neutral 50.
The bulls have not yet regained control of the market on the lower timeframes, and traders must position themselves accordingly.
Source: Santiment
The on-chain metrics reflected some bullishness. The dormant circulation has been minimal over the past week, despite the price slump on the 27th of January.
This reflected a lack of token movement that usually accompanies a flurry of selling activity.
To reinforce this idea, the mean coin age continued to trend higher despite the recent price downturn. This was a sign of steady XRP accumulation.
Therefore, it was likely that XRP would eventually be able to push beyond the $3.2 resistance zone.
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The 30-day MVRV ratio was positive, and this could see some selling from short-term holders taking profits.
XRP could slowly slide lower on the price chart over the coming days before the bulls were ready to drive another move higher.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
