XRP Price Prediction – Why This Could Be The Time to Start to DCA Into Ripple’s XRP
XRP price is back in the buy zone, and analysts believe it is a bargain to get in at this time. The leading international money transfer token snapped out of a market-wide relief rally that saw assets like Solana (SOL), Polygon (MATIC) and Litecoin (LTC) post double-git gains in less than a week.
Ripple has continued to spread its wings across the globe, notwithstanding the lawsuit by the Securities and Exchange Commission (SEC). The regulator accuses Ripple and its top executives of selling XRP as an unregistered token, thus breaching the Securities Act.
The SEC and Ripple filed their final submissions toward the end of 2022, and the world is waiting anxiously to hear the court’s ruling. At the center of the case are the Hinman documents and emails stating Ethereum was not a security. Legal experts like John Deaton say the lawsuit have a higher chance of going to trial than a settlement.
<oembed url="https://twitter.com/JohnEDeaton1/status/1610292287925374977?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1610292287925374977%7Ctwgr%5E3dbe4b198168cb04d6fd49d6f9cb4eae6e0e1356%7Ctwcon%5Es1_&ref_url=https%3A%2F%2Fu.today%2Fripple-v-sec-crypto-attorney-offers-perspective-on-settlement-in-light-of-hinman-emails[/embed] Whale Addresses Scoop Up XRP; What Does This Mean for XRP Price?
XRP price has been falling since September, when bulls tapped out at $0.56. Meanwhile, support at $0.30 has remained intact despite being tested five times in six months. This same level would mark the XRP price bottom ahead of a major rally into the next bull market.
According to Santiment, large-volume investors, popularly referred to as whales, have since November put all their weight behind XRP. Their commitment to filling their bags continues unbothered by the 90% drop in value from the token’s all-time high of $3.15 in January 2018.
The chart below reveals that whale addresses with 100K to 1M coins now hold 11.59% of the network’s supply, up from 10.45% as posted on November 1. Addresses with 1M to 10M coins echoed a similar growth pattern and currently hold 7.12% of the supply from 6.33% in the same period.
XRP Supply Distribution
Spikes in the Supply Distribution metric often suggest investors have an optimistic outlook for XRP price to the extent that the collapse of Sam Bankman-Fried’s FTX exchange did not
deter them from sustaining a buying spree. Eventually, the pressure mounting behind XRP will pave the way for a tremendous northbound move in price.
Investors scooping up XRP might be banking on Ripple bagging a final win against the SEC in court, hopefully within this first quarter of the year. Ripple won several motions against the regulator as the case progressed, compelling investors to believe a win was forthcoming. A win for Ripple will be a win for XRP and the crypto industry.
Why Investors Should Start to DCA into XRP XRP is back in the buy zone based on a profit/loss model by Santiment, one of the leading on-chain analytics platforms. The Market Value Realized Value (MVRV) position at -4.9% shows that this is the time to start dollar-cost averaging (DCA) into the sixth-largest crypto.
DCA refers to an investment strategy where an investor commits the same amount of money in assets like stocks and crypto tokens at regular intervals over a specified period, regardless of the prevailing price or market conditions. By employing this investment method, investors can lower their average cost per share while reducing the impact of volatility on their portfolios.
Therefore, with XRP currently considered oversold and undervalued, a DCA approach might help investors find solid footing as the market searches for support. According to the MVRV, recovery is around the corner, with investors expected to increase their exposure to XRP. Remember, some may start selling as the MVRV ratio climbs above the mean line (1), a move likely to mount pressure and stifle growth in the coming weeks, perhaps months.
XRP MVRV ratio XRP Price Holds Above a Potential Bottom
XRP price is back on the drawing board after bulls respected the seller congestion at $0.3750, an area reinforced by the falling trend line (dotted) on the daily time frame chart just before the New Year. Another attempt to break above the same trend line was cut short by the bearish wave traversing the crypto market ahead of the weekend.
XRP/USD daily chart
The Stochastic oscillator affirms that sellers have a firm grip on the price. If bulls don’t find an escape from the firming bearish shackles, XRP price will resolve to seek liquidity at $0.30 – a possible bottom level.
Investors must wait until XRP price rebounds from support, either at $0.33 or $0.30, before placing long positions. Ideally, the safest trades would be placed above the stubborn falling trend line in confluence with the 50-day Exponential Moving Average (EMA) (in red) at $0.37.
Further up, investors may be looking forward to booking profits at the 200-day EMA (in purple) around $0.4385, September’s resistance at $0.56 and the hurdle at $1.