2 - 3 minute read
As the landmark case between Ripple and the Securities and Exchange Commission (SEC) nears its conclusion, metrics are pointing to a strong bullish outlook for XRP in 2023.
According to an analysis by market analytics platform Santiment, there are several notable market divergence metrics indicating a positive outlook for the native token of the XRP Ledger blockchain network. These include the rapid accumulation of XRP by whale addresses and a significant long/short ratio on the verge of being crossed.
The analysis also notes that a group of XRP holders who own between 1 million and 10 million tokens has increased their holding by 25% over the past six months, bringing their total to 4.09 billion XRP. This trend is often seen at market bottoms and is significant because these whale holders have the ability to influence the price of XRP.
Additionally, the funding rate of XRP on Binance is currently slightly negative at -0.026%, which suggests bearish sentiment among traders. However, this sentiment is primarily driven by retail traders on Binance, who may not accurately predict short-term price movements.
A more telling metric to watch is the 30-day MVRV for XRP, which measures the profit or loss of short-term traders. The MVRV is currently showing average losses of -7%, indicating that short-term traders are hesitant to sell their coins at a loss. This could potentially lead to a surge in the price of XRP.
The MVRV Long/Short difference metric, which measures the average profit or loss of long-term holders versus short-term holders, is also trending upwards. Although currently at -11.45%, this could potentially lead to an upswing in the price of XRP as well.
Despite these bullish indicators, the price of XRP has mostly fluctuated between $0.28 and $0.54 for the past six months and currently trades at around $0.35, up 1.17% in the last 24 hours. However, the anticipation of ecosystem announcements and a potential favourable ruling in the SEC case against Ripple could cause the price of XRP to break out of this range.