Home Altcoins News XRP Price Struggles with Bearish Pressure, Holds Key Support

XRP Price Struggles with Bearish Pressure, Holds Key Support

XRP Price

XRP, the cryptocurrency native to the Ripple network, has faced strong bearish pressure in recent days, causing its price to dip to a monthly low. The market’s mood has soured, and with declining active addresses signaling weak buyer interest, the outlook for XRP appears uncertain. Although the asset remains above key support levels for now, the increasing selling momentum raises concerns about a further drop.

Declining Activity Fuels Bearish Sentiment

A crucial indicator, the Price Daily Active Addresses (DAA) Divergence, currently displays a sell signal, pointing to a troubling trend. The DAA Divergence shows that the combination of falling prices and fewer active addresses engaging with the network is a sign of weakening investor sentiment. As fewer participants buy or hold XRP, the cryptocurrency’s market value becomes increasingly susceptible to further declines.

In essence, the drop in market activity signals that investors are pulling back from XRP. The reduced trading volume reflects diminished confidence in the altcoin’s near-term price prospects. Should this lack of buying interest continue, XRP could face additional downward pressure in the coming days or weeks.

XRP’s RSI Falls to Three-Month Low

Adding fuel to the bearish sentiment, XRP’s Relative Strength Index (RSI) has dropped to a three-month low, signaling that selling pressure is reaching new highs. The RSI, a key market momentum indicator, measures the strength of a price trend. A decline in the RSI below the neutral 50 level reflects increased selling, with investors looking to exit their positions.

Typically, when the RSI falls significantly, the asset can enter the oversold zone, suggesting that it is undervalued and could be due for a price recovery. However, XRP’s history suggests that prolonged bearish conditions may continue before a meaningful rebound happens. For now, the RSI suggests that the altcoin might not be able to stage an immediate recovery.

The Importance of the $2.33 Support Level

At the time of writing, XRP is trading around $2.37, still holding above its crucial support level of $2.33. This support zone has become critical for the altcoin as it tries to stabilize in the face of growing bearish momentum. If XRP holds above this level, there’s a chance it could attempt to recover. However, if the price breaks below $2.33, it could trigger a sharp drop toward the next significant support level of $1.94, exacerbating the losses for investors.

This next potential level of $1.94 represents a crucial point for XRP’s price. A break below this price could suggest that the bearish control of the market is firmly in place, potentially prolonging the decline. In such a scenario, XRP’s ability to recover in the short term would become much more challenging.

What’s Next for XRP?

The path forward for XRP largely depends on its ability to maintain support at the $2.33 level. A successful bounce off this key support could set the stage for a retest of the $2.70 resistance level. Should XRP be able to break through this resistance and flip it into support, the bearish outlook could be invalidated, and the cryptocurrency might see a recovery rally in the weeks to come.

On the other hand, if XRP fails to hold the $2.33 support, the downside risks will increase, and a further drop could be imminent. Investors will need to keep a close watch on the price action in the coming days, as the outcome of this battle between bulls and bears will shape XRP’s near-term prospects.

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Maheen Hernandez

A finance graduate, Maheen Hernandez has been drawn to cryptocurrencies ever since Bitcoin first emerged in 2009. Nearly a decade later, Maheen is actively working to spread awareness about cryptocurrencies as well as their impact on the traditional currencies. Appreciate the work? Send a tip to: 0x75395Ea9a42d2742E8d0C798068DeF3590C5Faa5

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