- XRP drops 6.62% after 94% of wallets reached profitable status above $3
- Historical pattern shows similar profit-taking led to 85% price collapse
- RSI at 43.05 suggests recovery potential compared to July’s 83.69 reading
XRP has corrected sharply from its July 18 peak of $3.66, with the cryptocurrency losing 6.62% in its largest daily decline in a month.
Market analyst Winny had warned that with such high wallet profitability, selling pressure would eventually materialize as holders took profits. This trend mirrors historical behavior during the 2020/2021 bull run when XRP reached $1.96 and wallet profitability exceeded 90%, leading to an eventual 85% price collapse.
Current Correction Shows Contained Selling Pressure
Despite the profit-taking activity, XRP has maintained relative strength compared to previous cycles. An 85% collapse from recent highs would drive XRP to $0.45, while a 95% decline would result in $0.15 pricing, neither of which has materialized.
Winny suggests this cycle may differ due to growing whale wallet accumulation, increased network activity, and positive technical formations. While broader market weakness and profit-taking have pushed XRP below the $3 psychological level, the token holds around $2.90 as it attempts recovery.
The contained nature of the current selloff contrasts with historical patterns where extreme profit-taking drove much deeper corrections. Current whale behavior and institutional interest may be providing support levels that weren’t present during previous cycles.
Technical Indicators Point to Recovery Potential
XRP’s daily RSI currently reads 43.05, indicating oversold conditions with room for upward movement. This contrasts sharply with mid-July when XRP traded at similar $2.90 levels but showed an overstretched RSI of 83.69.
Despite the elevated RSI reading in July, XRP continued rallying to $3.66 within days, suggesting current oversold conditions could support recovery attempts. The lower RSI provides technical foundation for potential moves toward new highs if buying pressure returns.
The combination of oversold technical conditions and maintained support above major psychological levels suggests XRP may have found a temporary floor. However, the historical precedent of profit-taking cycles indicates continued volatility as the market processes the high concentration of profitable positions.
Current market structure shows both the predictable nature of profit-taking cycles and potential differences in this cycle’s dynamics through institutional participation and whale accumulation patterns that may alter traditional selling behavior.
Source: https://thenewscrypto.com/xrps-predicted-correction-unfolds-as-94-wallet-profitability-triggers-selloff/
