Is XRP in the Danger Zone? Could XRP Price Drop to Zero?

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As a seasoned crypto investor who has witnessed the rollercoaster ride that is the digital asset market, I must admit that the recent downturn of XRP has left me somewhat concerned. The ongoing legal battles and regulatory scrutiny against Ripple have always been a source of uncertainty for XRP investors like myself. Add to that the recent drop in Bitcoin’s price and you’ve got a perfect storm brewing.

The value of XRP might face potential risks since it fell beneath a significant support line. The ongoing legal disputes and intense scrutiny from regulators toward Ripple have led some investors to ponder if XRP could plummet to zero. Moreover, the unpredictable fluctuations in the market due to Bitcoin‘s decline below $67,000 has only added complexity to this situation.

During yesterday’s New York trading, I noticed that the value of my XRP holdings stayed roughly around $0.5289 – a 3% dip compared to the previous day. This slide not only occurred within the last 24 hours but also marked a new low for the week. This downturn has been adding to the mounting concerns among us XRP investors.

As an analyst, I’m observing a 2.6% decline in the overall cryptocurrency market, which might influence the current trajectory of Ripple (XRP). However, it’s intriguing to ponder if the value of XRP could potentially plummet to zero under certain circumstances.

Why Is XRP Price In The Danger Zone

It appears the market sentiment towards XRP is predominantly pessimistic, with various indicators pointing towards increased selling activities among traders, suggesting they are either liquidating their holdings or preparing to do so.

Based on Santiment’s data, the overall profitability of XRP decreased from October 14th to October 23rd. The proportion of daily transactions on the XRP Ledger that resulted in profit versus loss dropped significantly, going from 2.7 to 1.27. This implies that out of every ten transactions made during this period, only 1.27 were profitable, marking a 47% decrease over the course of a week.

Furthermore, the proportion of XRP coins yielding a profit decreased from 79% on October 21 to 74% on October 23. This indicates that XRP investors may be experiencing losses and could potentially be offloading their holdings to minimize future losses.

According to the 7-day Liquidation Map from Coinglass, traders have taken a predominantly bearish stance towards XRP on Binance, OKX, and Bybit. This is evident as they have opened $76 million in short positions compared to only $34 million in long positions. This lopsided positioning suggests that the market expects a possible drop in the price of XRP.

Despite the bearish sentiment, analysts remain adamantly bullish on XRP, even calling for a $16 Ripple price tag in the coming weeks and months.

Will Ripple Price Drop to Zero?

Despite currently following a bearish pattern, it’s highly improbable that the XRP price will fall to zero. The recent price movement has shown a short-term downtrend after breaking away from the upward wedge formation. This breakaway is accompanied by signs of vulnerability in the market and a significant drop, which suggests a high level of selling pressure at present.

The candlestick shapes indicate a powerful downward trend, suggesting that traders selling XRP are in control. This has caused the price to dip beneath the ascending triangle, which is additionally a component of a bear flag – a pattern that signals an ongoing bearish movement.

As XRP descends, it’s expected to encounter potential support levels around $0.50 – $0.505 and lower at $0.43 – $0.435. This represents approximately an 18% fall from the present value. Furthermore, this area could be the last substantial point where buyers might step in before we start looking for a turnaround or a period of price stability.

At the lower end of the ascending trendline (around $0.545 – $0.550), there’s now a robust barrier. If XRP price tries to surge, this area might push it back. But if market circumstances shift, the price could re-enter the uptrend channel, making the current drop seem like a false signal, thereby disproving the bearish hypothesis.

In simpler terms, the Relative Strength Index (RSI) currently stands at 39.43, which is close to the zone indicating that assets are being sold more than usual. However, this may signal a possible rebound if the asset price falls to this oversold level and reaches the projected target.

The SEC v. Ripple lawsuit is a major contributor to the price movement of XRP, and now, with the recent $10 million XRP donation to VP Kamala Harris, Ripple may be intertwined with the already hot U.S. election campaigns.

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2024-10-23 13:37