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Steve Muchoki
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Key Notes
- XRP price faces further short-term correction fueled by lower demand from whale investors.
- The notable XRPL growth will bolster XRP’s bullish sentiment in the long haul.
Ripple Labs-backed XRP XRP $2.44 24h volatility: 5.9% Market cap: $141.58 B Vol. 24h: $3.89 B , the native coin for the XRPL network, was among the heavily impacted altcoins in the past 24 hours as Bitcoin price BTC $84 334 24h volatility: 2.7% Market cap: $1.67 T Vol. 24h: $28.65 B dropped to $91K earlier on Monday. The large-cap altcoin, with a fully diluted valuation of about $238 billion and a 24-hour average trading volume of around $28 billion, dropped over 40% in the last four days to reach a range low of around $1.77 before rebounding slightly to trade about $2.37 on Monday, February 3, during the mid-London session.
As a result of the heightened volatility, XRP’s related trading pairs recorded over $123 million in forced liquidations during the past 24 hours, with over $98 million involving long traders. With over 80% of long XRP traders liquidated in the last 24 hours, the odds of a long squeeze have significantly increased, which could lead to further losses.
XRP Whales Cut Down Losses
The appetite for XRP in the last few months, especially from whale investors, has remained relatively high. As Coinspeaker explained, the demand for XRP in the recent past was catalyzed by the filing of S-1 for spot XRP ETF with the US SEC by WisdomTree, CoinShares, Bitwise, Canary Capital, and 21 Shares.
However, on-chain data shows that XRP whales, with an account balance of between 10M and 100M coins, have offloaded more than 130 million coins in the past 24 hours. As a result, the XRP whales in this category currently hold about 6.46 billion coins.
Whales have offloaded over 130 million $XRP in the past 24 hours! pic.twitter.com/s43x7Rviba
— Ali (@ali_charts) February 2, 2025
Midterm Expectations
Following the ongoing crypto correction, XRP price has dropped below the 50-day Moving Average (MA) for the first time since the post-November bullish breakout. Additionally, the weekly Relative Strength Index (RSI) has dropped below the 70 percent level, after staying above the same level for more than two months, signaling a bearish sentiment.
From a technical analysis standpoint, XRP price is currently retesting the bullish breakout from the 2021 all-time high of around $2. A successful close above $2 for XRP in the coming weeks will set the stage right for the parabolic phase of the 2025 bull market.
However, a consistent close below $2 in the coming weeks will push the XRP price even lower toward the support level above $1.26, which coincides with the 2.618 daily Fibonacci extension.
Bigger Picture
Ripple’s XRP has been one of the biggest beneficiaries of Donald Trump’s administration, which has laid significant emphasis on the cryptocurrency mainstream adoption. The crypto-related executive orders by US President Donald Trump in the past few weeks have paved the way for regulatory clarity in the United States, as Senator Cynthia Lummis champions the Congress for bipartisan reform on the Web3 industry.
However, the recent tariff wars between the United States with its trading partners led by China, Canada, and Mexico have increased the short-term wider market uncertainty.
As a result, the previous XRP bull rally will have to depend on Ripple Labs and XRPL’s fundamentals.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
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Julia Sakovich
