Monero price prediction – Assessing volatility risks after XMR’s latest ATH

Monero [XMR] fell by 13.5% in the last 24 hours, with its daily trading volume shrinking by 25%. The privacy token is the sector’s leader with a market cap of $11.41 billion.

It registered its all-time high of $799 on Wednesday, 14 January. The sudden growth spurt in XMR’s price was likely linked to a hardware wallet attack on 10 January.

Crypto sleuth ZachXBT explained that a victim lost more than $282 million worth of Litecoin [LTC] and Bitcoin [BTC] to a social engineering scam. The attacker began to convert the stolen crypto assets to Monero via multiple instant exchanges, causing a sharp price hike.

What’s next for Monero?

At the time of writing, the privacy token appeared to be trading at a premium. It had retraced to $625, but the closest established demand zone was around the previous all-time high of $518, and further south at $400-$440.

XMR buyers now will be assuming a large amount of risk, and might be better served to wait for a pullback. Of course, this is assuming the privacy token can go past $800 in another rally – A scenario that seems doubtful.

In a post on X, crypto analyst Maartunn pointed out similarities between the top privacy tokens’ recent rallies. CryptoQuant’s metric, futures retail activity through trading frequency surge, can help mark when retail investors trade an asset enthusiastically.

This generally happens following sharp price gains that bring the asset to more of the public’s attention. Especially as speculators rush to make profits on bullish strength. Ironically, this can lead to long positions getting squeezed as prices gravitate towards liquidity.

The analyst observed that a similar overheated futures retail activity marked retail hype for Zcash [ZEC] and Dash [DASH]. In fact, both tokens saw deep price pullbacks.

The warning is that Monero could be next on the list.

The 1-day chart showed that a price dip to the 61.8% Fibonacci retracement level looked likely. At $447, this level also has confluence with the 50-day moving average, which XMR bulls have defended since October.

Final Thoughts

• A hardware wallet attack lost assets worth $282+ million. Some of these converted to XMR could have fueled the altcoin’s latest rally.
• Overheated retail futures participation may be a warning sign of hype.