XRP Price Drops Amid Cryptocurrency Sell-Off, But Fundamentals Remain Strong

The XRP price has wiped out some of its gains from November as the cryptocurrency sell-off continued, with the coin retreating to $2.14 on Monday. This marks a 26% decline from its highest level this month, pushing XRP into a bear market.

Declining Social Sentiment and Futures Open Interest

XRP’s decline is accompanied by a drop in its social sentiment score and futures open interest. According to recent data, the futures open interest has fallen to $1.89 billion, down from the year-to-date high of over $4.29 billion. Additionally, Ripple’s daily volume has decreased in the past few weeks as its momentum waned, with its 24-hour volume now standing at over $10 billion, much lower than what it handled a few weeks ago.

Positive Fundamentals Could Drive Price Recovery

Despite the current downturn, XRP has some important fundamentals that could push its price higher in the near term. One key metric is that many large holders are not selling, with XRP having over 5.75 million holders, higher than the October low of 5.36 million. The number of active addresses has also dropped slightly during this sell-off.

XRP also has several catalysts ahead, including the growing market cap of the Ripple USD stablecoin, which has risen to over $53 million a week after its launch. Furthermore, there are rising odds that the Securities and Exchange Commission will approve a spot XRP ETF in 2025, which could create more hype and demand for the coin.

XRP Price Analysis: A Bullish Pattern Forms

The daily chart shows that the Ripple price is slowly forming a bullish pennant chart pattern, a popular continuation sign made up of a vertical flag pole and a triangle pattern. The lower side of the triangle connects the lowest points on Dec. 10 and 20, while the upper side touches the highest swing on Dec. 3 and 17.

There are signs that this consolidation will continue for a while, but XRP has moved above the 50-day moving average and is at the weak, stop & reverse point of the Murrey Math Lines. As a result, the coin is likely to have a bullish breakout as bulls target the year-to-date high of $2.90.

Some key points to consider for XRP investors and traders include:

  • XRP’s large holder base remains intact, with over 5.75 million holders, higher than the October low of 5.36 million.
  • The number of active addresses has dropped slightly during this sell-off, indicating a potential buying opportunity.
  • The Securities and Exchange Commission’s potential approval of a spot XRP ETF in 2025 could create more hype and demand for the coin.

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