XRP has seen its own fair share of ups and downs over the past few months. Until a week back, it seemed likely that XRP would shoot up in its valuation. But now, it appears that the hype has already fizzled out.
Chaos on the price chart
On the 4-hour chart, XRP was trading within its descending channel that was formed four days back. The seventh-largest token did manage to break above it on 10 November but re-entered the channel within a few hours. Even at press time, XRP was seen more inclined towards the lower trend line. Further, it was trading at a value way below its moving average.
In an earlier article, it was highlighted that XRP had formed a new long-term bullish structure that could pave the alt’s path to $4. However, at press time, the aforementioned structure seemed to almost be invalidated by the latest red candle.
Recently, Ripple announced that it would be launching a new service called the ‘Liquidity Hub’ for enterprises to easily and efficiently source digital assets from the broader crypto market. The consumer-facing product is set to be released in 2022 and will initially support coins including BTC, ETH, LTC, ETC, BCH and XRP. With time, however, other assets would be added.
This news failed to aid the token rally and XRP. By and large, maintained the sanctity of its downtrend.
The state of key metrics, further, painted a bearish outlook for the token. Consider XRP’s velocity, on 11 November, this metric was at its 6-month low. Now, price tops for XRP have, more often than not, coincided with high velocity and the current state of this metric opposes the price chart inclination narrative.
What’s more, the mean dollar invested age has started declining. As the age of dollars become younger, it can be argued that dormant coins have started moving, disrupting the broader accumulation trend. Thus, this isn’t a healthy sign either.
The MVRV ratio has also been spending more time in the negative territory of late. Thus implying that HODLers aren’t earning less than usual in the market. Hence, it can be asserted that there is not much incentive for new investors to enter the XRP market.
Ergo, in light of the aforementioned trends, it can be concluded that the odds of XRP rallying at this point fairly seem to be slim.