XRP Price Correction: $2.34 Support Crucial
XRP Price Correction: $2.34 Support Crucial
XRP experienced a slight retracement after reaching a local high of $2.65, falling to $2.49 over two days. At the time of writing, XRP trades at $2.50, down 3.31%.
Analyst Man of Bitcoin suggests XRP may have peaked, citing Elliott Wave analysis. A break below the descending trendline would signal a correction.
Elliott Wave Analysis Suggests Wave 2 Correction
The Elliott Wave structure points to a wave 2 correction, a typical pullback after a wave 1 upswing where investors take profits. Key support for this wave 2 lies between $2.19 and $1.79, with $2.33 acting as a crucial validation level.
Price Rally Lacked Underlying Demand
Our analysis indicates XRP's recent rally wasn't driven by organic demand but speculative buying. Several metrics confirm this:
- Negative Price-DAA Divergence: This bearish signal shows price growth outpacing user base expansion.
- Spiking NVT Ratio (99 to 207): Indicates valuation surpassing transaction volume, further suggesting weak demand.
Despite these concerns, XRP's MVRV of 2.9 suggests a market top is unlikely. Historically, local tops occur around 3.2, and market tops above 3.5.
What's Next for XRP?
The current price decline seems influenced by a broader market pullback. While a drop to $2.19 seems improbable, a further pullback to $2.34 is possible if the downward trend continues. Alternatively, a rebound to $2.56 is feasible if market sentiment improves.
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