The Future Remains Bright as Ripple (XRP) Heads for a Significant 15% Correction
The network continues on its path to become even more integrated into the financial sector, making any downturn merely temporary.
The price of Ripple (XRP) appears to be on the verge of a significant drop on the daily chart, as it has been unable to overcome a critical resistance level. The lack of recovery may prompt investors to sell, which could lead to further price declines and complicate any recovery efforts. However, all is not doom and gloom for Ripple.
Ripple Investors Are Cautious
The drop in XRP’s price to $0.42. on Gate.io has fueled a sense of pessimism among token holders, as reflected in its recent actions. Divergence between the price and the daily active directions (DAA) indicates a sell signal. This divergence occurs when the price increases while the share decreases, or both have a downtrend.
The latter scenario is what XRP is currently facing, suggesting that holders may dump their assets to avoid further losses. The inclination to sell is also affecting potential new investors. This is apparent from the network growth metric, which is at its lowest point in four years. Network growth measures the rate at which new addresses are created, which provides information on the popularity of a project in the market.
The decline in Ripple’s network growth indicates that the project is losing traction, which likely deters new investors. As a result, the price of XRP could face further downward pressure due to this broader bearish sentiment.
XRP Key Support Level
The price of XRP at $0.51 currently sits at the 23.6% Fibonacci retracement level between $0.73 and $0.42. This level is known as the bear market support floor. As long as this support holds, there is a chance for the asset to rally.
Given the bearish sentiment among investors, though, there is a real risk that XRP will fall below this key support. If this happens, the altcoin could fall to test the $0.47 support, which would trigger an 18% drop as the Ripple token heads towards the $0.42 lower bound.
However, the XRP models’ price forecast paints a picture of an imminent increase in value, and therefore any price drop is temporary.
XRP’s Trials and Tribulations
Ripple Labs is known for being the regular in court. Most of it is not by design, and so the company recently filed its response to the Securities and Exchange Commission’s (SEC) demand that the company pay nearly $2 billion in fines in a court document filed Monday night. that Ripple should face substantial fines for selling XRP to institutional investors.
However, Ripple responded to this assertion in its rebuttal, suggesting that a more appropriate fine would be approximately $10 million, significantly less than the SEC’s initial estimate.
Stuart Alderoty, Ripple’s chief legal officer, mentioned in a post on X on Monday that Ripple’s rebuttal to the SEC’s request for $2 billion in fines for legacy institutional sales is now public.
He stated that in a case where there were no allegations or findings of recklessness or fraud and where Ripple won on key issues, the SEC’s request is another sign of its ongoing efforts to intimidate the entire crypto industry in the US.
Alderoty also expressed confidence that the judge would be fair during this final phase of the case. He indicated that Ripple is confident that the judge will handle the remedies phase objectively.
By Leonardo Perez