XRP Faces Bleak Outlook as Market Sentiment Hits Lowest Point Since May 2023

Despite the recent success of cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and Solana (SOL), (XRP) is grappling with persistent weakness, causing concern within the crypto community.

Notably, XRP has been caught within a tight squeeze since July 2023, with its price exhibiting minimal volatility following a sharp drop last week.  One key factor contributing to XRP’s lackluster performance is the significant increase in sales by Ripple, the company behind XRP. Notably, Ripple periodically sells XRP as part of its business operations and discloses information about its XRP sales, providing transparency to the cryptocurrency community.

Ripple has previously disclosed that its XRP sales are exclusively linked to on-demand liquidity (ODL) transactions. Notably, ODL has experienced sustained growth, making it the company’s “strongest” product throughout the last quarter and the entire year. Since its launch in 2018, ODL has facilitated instant global money transfers for Ripple customers, distinguishing it from traditional remittance methods plagued by delays and high fees.

However, according to blockchain data shared by crypto analyst Mr Huber, Ripple’s net sales of XRP reached a staggering 237 million units in December 2023, translating to $142 million. This figure is three times higher than the average monthly sales for the cryptocurrency. Notably, such a substantial increase in sales triggers anticipation of an imminent buyback by Ripple based on historical patterns.

According to Mr. Huber, this raises a red flag, given that an extended period without net buybacks, typically lasting 8-10 weeks, could be cause for concern.

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Renowned crypto analyst Ali Martinez also weighed in on the situation, revealing that the weighted market sentiment for XRP has hit its lowest negative point since mid-May 2023. However, the pundit suggested that for contrarian XRP investors, this could present an intriguing signal and unique market opportunities.

Furthermore, Martinez pointed out an ascending parallel channel governing XRP’s price action since June 2022. If this pattern persists, XRP might move towards the channel’s middle or upper boundaries, currently at $0.80 and $1.10, respectively. 

Of notable significance is that XRP has recently experienced a rebound and is presently positioned above a crucial multiyear support level, approximately at $0.55. In case of a breach beyond the pink trendline, the cryptocurrency could potentially advance to $0.70, as there is limited resistance in the immediate vicinity. A successful progression beyond this level might pave the way for a further ascent, targeting $0.90.

At press time, XRP was trading at $0.50, reflecting a 0.55% decrease in the last 24 hours.

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• Source: https://zycrypto.com/xrp-faces-bleak-outlook-as-market-sentiment-hits-lowest-point-since-may-2023/