As an analyst with over two decades of experience in the financial markets, I have seen my fair share of market cycles and trends. The recent surge and subsequent stagnation of XRP has caught my attention, and I must say, it’s a fascinating case study.
TL:DR;
- XRP was the top performer for weeks after Gensler’s announcement about his SEC departure but has calmed and retraced hard in the past few days.
- As such, many analysts have cautioned that the asset might have already topped out during this cycle and warned traders to be wary about longing it.
XRP’s Rally and Stagnation
The ‘Trump Pump’ impacted the entire cryptocurrency sector, propelling it upward. Although XRP initially moved slowly, it ultimately kept pace and outperformed other assets on multiple occasions. In fact, on a monthly basis, Ripple‘s native token skyrocketed by more than 420%, reaching almost $3 at its peak.
This past week saw a significant rise in XRP’s value, pushing it ahead of Solana (SOL), Binance Coin (BNB), and Tether (USDT) to claim the third-largest position among all cryptocurrencies based on their total market capitalization.
Initially, everything seemed to be going well for XRP. A significant portion of its volume and demand was driven by strong interest from South Korea. But then, unexpectedly, the country’s political leaders declared a temporary enforcement of martial law, which negatively impacted the situation.
Despite a broad decline across the crypto market after the recent news, XRP was affected more severely and struggled to rebound compared to Bitcoin and numerous other altcoins in the subsequent days. Contrary to these cryptocurrencies, XRP has fallen behind Tether on the charts and experienced underperformance over the last 24 hours, even with Donald Trump appointing a pro-crypto SEC Chair to replace Gary Gensler, who has been critical of Ripple.
Brad Garlinghouse, CEO of Ripple, expressed his approval towards Paul Atkins as the new leader at the Securities and Exchange Commission (SEC), stating that he believes Atkins will “reintroduce a pragmatic approach to the agency.
An excellent pick – Paul Atkins leading the SEC promises a return of practicality to the agency. Together with Hester Peirce and Mark Uyeda, it’s high time we put an end to the ban on cryptocurrency, allowing for the reinstatement of individual choice, economic progress, and technological advancement.
— Brad Garlinghouse (@bgarlinghouse) December 4, 2024
Topped Out?
After dropping approximately 20% from its recent high this week, several financial experts have raised concerns that XRP may have reached its peak in this cycle. Cryptocurrency’s Batman suggested that the token was turned down at a five-year bearish trendline and advised cautious leveraged traders to exercise caution before entering long positions.
The price of XRP could potentially peak, encountering resistance at a 5-year downward trendline. Keep in mind that the cryptocurrency market is unpredictable, so exercise caution when considering long positions.
— BATMAN (@CryptosBatman) December 5, 2024
Nebraskangooner too expressed a comparable viewpoint, drawing upon a recent tweet from the CEO of Ripple, which an analyst humorously suggested could have foreshadowed the peak.
Brad with the well-timed local top tweet on $XRP
— Nebraskangooner (@Nebraskangooner) December 5, 2024
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2024-12-05 15:40