- XRP price remains above $0.35 as bulls fight against bear pennant pattern.
- Whales are buying low priced XRP tokens despite the uncertainty in the crypto market.
- Declines could extend to $0.30 if XRP breaks below the bearish pennant pattern.
- A break above $0.38 is needed for the resumption of the XRP price rally to $1.00.
XRP price is printing its first green 12-hour candle since the crypto market bled back after the FTX crisis. In the last 24 hours, the seventh largest cryptocurrency has seen a huge increase in trading volume to over $2 billion.
However, much of this volume drove XRP price lower, mainly amid concerns over a hacker who made $600 million in Ethereum from FTX. Since Saturday, the ‘FTX Drainer’ has been moving and exchanging coins from one blockchain to another. Approximately $72.9 million is currently bridged to renBTC.
XRP price recovers as investors’ risk appetite steadily improves
The XRP price is bouncing back and may be the reason the cryptocurrency is back at the top of investors’ priority lists, especially now that large holders are snapping up the token in droves. Addresses with 1,000,000 to 10,000,000 tokens have grown to hold 6.75% of XRP’s supply, compared to the 30-day low of 6.27%.
XRP supply distribution
Investors will continue to buy XRP this week if the Market Value Realized Value (MVRV) Profit/Loss pattern is below 1 of the moving average line, indicating that many may still be ‘out of the money’. Although the ratio has recovered since November 9, when it hit -25.56%, XRP is still in the buy zone at -11.52%.
Investors prefer to hold their assets when MVRV falls below 1 to avoid selling at a loss. As the price recovers, some holders offload their bags at a profit by selling when the ratio exceeds 1.
XRP MVRV ratio
XRP price defends key support
The whales in the XRP ecosystem did not budge despite the price drop. The buying pressure they create will help keep the XRP price buoyant, such as the $0.3500 support.
XRP price now trades at $0.3570 while printing a 12-hour bullish candlestick. Against all odds, the bulls managed to protect the support at $0.3500 and prevent a breakout from the bearish pennant pattern as illustrated in the chart below.
XRPUSD 12-Hour Chart
Bearish pennant patterns occur after a period of short consolidation followed by a significant sharp decline in price. Sellers use this time to catch their breath before lowering the price. Hence, if confirmed, XRP price may revisit the support at $0.3000 before another recovery attempt.
XRP price is not out of the woods yet, however, the Moving Average Convergence Divergence (MACD) indicator is about to flash a sell signal. Traders looking at lower XRP should wait for the 12-day exponential moving average (EMA) (in blue) to cross below the 26-day EMA (in brown) before activating their orders.
On the upside, sustaining the uptrend above $0.3500 is crucial to turn the outlook on XRP from bearish to bullish. Nevertheless, XRP is safe only after breaking above the pennant pattern, followed by a break and hold above $0.4000.