As a seasoned crypto investor with a keen interest in XRP, I’ve witnessed the price of XRP reach a three-year low against Bitcoin this week, which could potentially signal a local bottom and buying opportunity for those who believe in its long-term potential. While the XRP/BTC ratio has hit a 2021 low, it’s essential to consider the broader context: XRP’s downtrend against USD since the beginning of 2024, which has seen its price fall over 14% YTD to the current $0.53 mark.
This week, the value of XRP relative to Bitcoin reached a three-year low, indicating a possible bottom and potentially signaling an opportune moment for investors to purchase XRP.
XRP/BTC price ratio sinks to 2021 low
The price difference between Bitcoin and XRP reached a three-year low, as observed on TradingView, which hadn’t been seen since early April 2021.
As a researcher studying the XRP/BTC market, I’ve observed that this chart pattern on the monthly chart might indicate a potential bottom for XRP prices relative to Bitcoin. This observation aligns with Tony Severino’s analysis, as he, the founder of CoinChartist, expressed in a May 6 post on the XRP community forum.
“Great spot – he’s right. XRP/BTC just flashed a bullseye bottom signal.”
Although the upbeat appearance of the XRP/USD price chart may suggest otherwise, the value of XRP against the US dollar has been declining since the start of 2024. The current XRP price stands at $0.53, representing a 14% decrease year-to-date (YTD). In contrast, Bitcoin’s value versus the US dollar has surged by more than 43% over the same period.
Iva Wisher, the COO and co-founder of Prom and former chief analyst at 3commas, explained to CryptoMoon that XRP‘s stilted progress can primarily be linked to Ripple’s ongoing legal battle with the US Securities and Exchange Commission (SEC).
“XRP‘s price movement is tied to the uncertainty generated by its legal battle with the SEC. Such obstacles naturally lead to cautious investor sentiment and reduced trading activity.”
In December 2020, the Securities and Exchange Commission (SEC) filed a lawsuit against Ripple, alleging that they had raised over $1.3 billion through the sale of XRP in an unregistered securities offering. Essentially, the SEC claims that Ripple should have registered XRP as a security before selling it to investors.
Recently, Ripple disagreed with the SEC’s proposed penalty of $2 billion against the blockchain firm and argued that an acceptable fine would be no more than $10 million.
Is the XRP local bottom in?
In spite of XRP‘s muted price behavior, Charting Guy, an anonymous cryptocurrency analyst, predicts that it may reach a fresh peak by July based on his analysis shared in a May 6 blog post.
“Fractal projected target is 0.00006486. With today’s BTC price, that puts us at a roughly $4.09 XRP. As I’ve been saying forever, new all-time high by July. Now say $BTC is at $85,000 -$100,000 at that time like I think it’ll be. Then we’re talking a $5.51 – $6.48 XRP.”
As an analyst, I would interpret the daily chart of XRP in the following way: The relative strength index (RSI) indicator for XRP was reading 50 points, indicating that its current price is neither overbought nor oversold, but rather at a neutral level or fair value. This represents a significant improvement from the 28 RSI reading on April 13, which suggested that XRP was heavily oversold at that time and its price had been undervalued.
As a researcher studying financial markets, I often utilize the Relative Strength Index (RSI) to assess the momentum of an asset’s price movement. This valuable indicator helps me determine if an asset has been oversold or overbought by evaluating the size and frequency of recent price changes.
Over the past three years, XRP‘s price has been on a continuous decline. On a weekly basis, XRP has recorded lower highs since April 2021. If this trend continues, the charts indicate that XRP’s price might drop to around $0.31, which was a noteworthy support level throughout 2022 and 2023.
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2024-05-07 21:13