XRP has recently achieved a historic milestone, reaching an all-time high, but market participants should exercise caution. Despite the impressive gains, signals like massive sell-offs, profit-taking, and breaches of key support levels are raising red flags. Could a sharp correction be imminent? This comprehensive analysis delves into the situation.
FOMO Effect Fades: An Inflection Point for XRP?
In recent weeks, XRP has witnessed a remarkable surge in its price, peaking at a new all-time high of $3.66. However, the rally’s momentum appears to be waning as fresh investors exit the market. The number of new XRP wallets saw a steep decline, dropping from 11,058 to just 3,930 in a mere 48 hours.
This sharp decline in interest from market participants, who previously propelled the price upward, signals potential trouble. Such behavior typically follows a price peak, with investors hesitating to commit until clearer signals emerge. The loss of this vital support from newcomers suggests XRP’s bullish momentum might be faltering.
Long-term Holders (HODLers) Begin to Sell
While new investors are pulling back, another indicator is drawing attention: the net position change of HODLers. Recent data shows red bars over the past two days, indicating that XRP’s long-term holders have started selling. This shift marks the first time in over a month that these investors, typically a stabilizing force, have altered their approach.
This reversal is concerning. Sales by HODLers typically indicate either a lack of confidence in continued price increases or a desire to lock in profits. Their decision to reduce their positions could intensify downward pressure on XRP.
Technical Analysis: Where Could the Drop Stop?
Currently, XRP is trading around $3.50, just 4% below its all-time high. However, technical indicators suggest potential challenges. If the selling trend continues, the altcoin could lose key support at $3.38. A breach below this level might trigger further declines, potentially pushing the price back to $3.00, erasing recent gains.
Conversely, if demand rebounds, XRP could stabilize above $3.38 and make another attempt to break through $3.66. A successful breach would propel the altcoin to $3.80, marking a new all-time high and dispelling correction concerns.
XRP is currently at a crossroads. Despite reaching unprecedented heights, technical signals and changes in investor behavior suggest a risk of a short-term trend reversal. XRP holders should exercise caution and closely monitor market developments in the coming weeks.
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For more information, visit the original source: XRP Price Forecast: Brace for Volatile Correction Post All-Time High.
