XRP Monthly MACD Signals Historic Shift Amid ETF Rush

The monthly MACD cross prints of XRP show a bearish; the ETFs aim at 42.87 percent of the liquid supply. The 2018 and 2022 trends indicate a significant reversal of trend in the future.

The monthly technical indicators of XRP cause flash alerts. The bearish MACD cross has just emerged on the monthly charts. Steph_iscrypto on X says this is a 2018 and 2022 arrangement. These two past events caused a full reversal of trends.

Source: Steph_iscrypto 

The currency is being traded when institutional demand is gaining speed. ETF products grabbed close to a billion dollars in 18 days. There are five spot ETF products in operation on U.S. exchanges. The market structure is undergoing a transformation it has never seen before due to the regulated products.

Critical changes in momentum are presented through technical analysis. MACD crosses within a month are also uncommon. The indicator quantifies direction changes and strength of the trend. Past bearish crosses were those observed in 2018 and 2022 followed by multiple years of declines.

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The 42.87% Supply Target Changes Everything

ETF demand prioritizes liquid supply solely. On X, SMQKEDQG emphasized that 42.87% is the actual circulation of XRP. Aggregate supply deceives market participants. Real supply dynamics are defined by the available pool.

Source:  SMQKEDQG

Existing ETFs are 0.75% of the total supply. Such a percentage does not appear large at the outset. But ETFs draw only on the 42.87% liquid pool. Every incremental supply narrows the market supply.

The mathematics creates supply pressure quickly.  ETFs do not require 100% of the aggregate supply. They would just have to decrease the 42.87% available percentage. The liquid pool reduces as institutional inflows are made. Markets already shape up supply pressure at an early stage.

The OTC books hold institutional liquidity. Institutional demand was previously cushioned by these reserves. OTC drains are now consumed by ETFs at an accelerating pace. The supply shock schedule condenses with the accumulation increase.

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Historical Patterns Point to Volatility

The 2018 MACD cross was followed by prolonged weakness. After that technical signal, XRP went down a lot. During that time, market sentiment changed towards the extreme. Similar pressure was produced in the 2022 cross.

The present market dynamics are not similar to previous stages. Product ETFs generate new sources of demand. Increased institutional access under regulation alters the usual dynamics. The issuers of ETFs report that the quality of inflows is extremely high, and over 70% of the participants are institutional investors.

Custodial accumulation speeds up the removal of supply. Spot ETFs are considered to keep the underlying asset in a deposit, where each share bought will lead to the removal of actual XRP in circulation. It is a mechanism that contrasts with futures products.