XRP Price Analysis: The bloodbath witnessed this week has raised pertinent questions about the future of the cryptocurrency market. As uncertainty rises, the outlook gets dimmer, especially with the total market cap at $2.4 trillion.
Nonetheless, this correction although massive could mean new opportunities for bystander investors who missed buying XRP and other altcoins before the Q1 rally.
Following a 7% drop, XRP price hovered at $0.4518 on Thursday. CoinGecko data showed another 3.4% correction in the last week with the market cap subsequently falling to $25 billion.
This shows the severity of the bearish situation, which has seen XRP drop by close to 40% from $0.75, the peak achieved in March. Should bulls fail to defend the immediate support at $0.45, the decline might extend to $0.4 in July before the next major trend reversal.
XRP Price Analysis: Can XRP Defy Gravity?
The Relative Strength Index (RSI) reinforces the bearish grip closing in on the oversold area. Sellers have the upper hand, accentuated by the RSI bearish divergence.
Breaching support at $0.45 would further throw the bulls in disarray. Due to the death cross patterns formed in May, bulls have a long way to go before making a comeback.
A sell signal from the Moving Average Convergence Divergence (MACD) validates the bearish trend. This coupled with the red histograms implies that XRP is far from leaving the woods.
Sentiment from the derivatives market is also negative, starting with a major drop in the open interest to $535 from $992 million in April. A consistent increase in OI backs the long-term bullish trend of the asset—the opposite is true.
Binance exchange where most of the XRP futures trading occurs, dominated the decline, accounting for $162 million of the current OI.
Traders in the derivative market bore the brunt of the pullback to $0.45 as liquidations intensified. Long positions suffered $3.24 million in liquidations in 24 hours, with only $41,000 in shorts.
Can XRP Recover Above $0.5?
A recovery is possible but will depend on various factors including the ability of support at $0.45 to hold. Traders must also be willing to ignore bearish calls and start buying XRP above $0.45 with the hope of an immediate rebound above $0.5 later this week.
Although the RSI on the daily chart is not oversold, it is at the bottom end of the neutral zone. With that in mind, many investors would be willing to put their weight behind XRP aiming to maximize profits in the long-term.
The post XRP Price Analysis: XRP Screaming Buy After Crash? appeared first on CoinGape.
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