XRP has faced a period of sideways momentum over the past month, with its price consolidating between key levels. This range-bound movement suggests that the altcoin has been struggling to break free from the pressure that led to its current consolidation.
Given the ongoing market conditions, XRP could face further decline before any potential recovery.
XRP Faces Extreme Pressure
The MVRV Extreme Ratio, which measures the relationship between market value and realized value, indicates that XRP is undervalued and under pressure. Currently, the MVRV has been below 1.0 for approximately 15% of trading days, signaling a lack of positive momentum.
Historically, this metric has either led to short-term recoveries or worsened the situation further, potentially driving XRP to new lows. Based on current trends, XRP may face the latter scenario, with continued downward pressure.
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XRP MVRV Extreme Values. Source: GlassnodeIn this context, the low MVRV ratio suggests that investors are hesitant to drive the price upward, and the market sentiment around XRP remains weak. Unless a significant catalyst emerges, the undervaluation reflected by this metric could continue to suppress XRP’s price in the near term.
XRP is also facing a shift in macro momentum, as the overall market sentiment appears to be turning bearish. The exchange net position change highlights an increase in selling pressure, with a decline in buying momentum.
As exchanges begin to register more inflows than outflows, the shift from buying to selling could signal that a downturn is imminent for XRP. This change in dynamics could put further strain on the altcoin, as it struggles to maintain upward momentum.
XRP Exchange Net Position Change. Source: GlassnodeAs buying slows down and selling picks up, XRP could see its price slip further. This shift in the macro momentum highlights the current market instability, which could contribute to a prolonged downtrend for XRP in the coming months.
XRP Price May Struggle To Recover
At the time of writing, XRP is trading at $1.35, caught within a range between $1.34 and $1.47. The downtrend that has persisted since the beginning of the year remains intact, with the cryptocurrency struggling to break free from the range. This resistance at $1.47 has proven difficult to overcome, while support at $1.34 has been tested multiple times.
Given the current market conditions and the pressure indicated by the MVRV ratio and macro momentum, XRP faces a bearish outlook in the short term. The price could break through the $1.34 support level, potentially falling to $1.21. This would signal a deeper decline and extend the ongoing downtrend, increasing the pressure on the altcoin.
XRP Price Analysis. Source: TradingViewHowever, if XRP holders manage to find support from investors and buying momentum resumes, the altcoin could break through the $1.47 resistance level. A move above this level could propel XRP to $1.58, invalidating the bearish outlook and signaling the potential for a reversal. If XRP manages to sustain upward momentum, it could eventually target $1.70, marking a complete shift in market sentiment.
Source: https://beincrypto.com/xrp-price-recovery-delayed-as-pressure-rises/
