- XRP fell below $2 as increased risk aversion shook the crypto market.
- XRP’s 30-day MVRV Ratio suggests that prices might have stabilized at a bottom.
- If XRP cannot regain support near $2.00, it could bounce off the lower boundary of a descending channel.
XRP saw a decline of 10% on Monday, trading at approximately $1.96 at the time of writing, as the likelihood of its price dropping below $2.00 surged to 81% on a prediction platform. Despite the prevailing risk-off sentiment, XRP’s 30-day Market Value to Realized Value (MVRV) Ratio indicates a potential price floor has been reached.
The market’s outlook on XRP has soured recently, with many speculators predicting further declines for the remittance-focused token.
The probability of XRP dropping below $2 climbed from 62% to 81% over the weekend, as reported by analytics. Additionally, the chances of XRP achieving a new all-time high of $3.50 plummeted from 51% at the start of March to just 7% on Monday.
Shortly after these odds shifted sharply, XRP slipped below the $2 mark.
This downturn can be linked to the overarching sentiment in the cryptocurrency market, exemplified by the Crypto Fear and Greed Index, which had fallen to 20.
Moreover, the absence of concrete plans from US President Donald Trump regarding XRP’s role in the nation’s digital asset strategy extinguished any budding bullish sentiment among investors. Trump reiterated his executive order at the first White House Crypto Summit on Friday, stating that the US would establish a Bitcoin reserve and a digital collection of altcoins funded by crypto assets seized through criminal or civil asset forfeiture.
The executive order failed to meet investor expectations, who had hoped for capital allocation to purchase Bitcoin and altcoins like XRP, especially after Trump’s earlier intentions to include them in the national crypto reserve were announced on February 2.
As bearish sentiment heightens, XRP’s 30-day MVRV Ratio has fallen to a low of 16%. This metric assesses the average profit or loss of all investors over a specific period.
XRP 30-day MVRV. Source: Data Analysis
Historically, XRP tends to rebound when the 30-day MVRV falls below 10%. This trend could indicate that XRP is positioned for a recovery.
XRP eyes support within the descending channel as bearish pressures intensify around the $2.00 threshold
According to data, XRP has experienced $36.01 million in futures liquidations over the past day. The cumulative amount of liquidated long and short positions totaled $28.63 million and $7.38 million, respectively.
Bearish traders pushed XRP’s price below the psychological support level of $2.00 as it moved into a descending channel over the weekend.
XRP/USDT daily chart
If XRP fails to reclaim support around $2.00, the lower boundary of the descending channel may be critical for sparking a price recovery.
Conversely, to overcome bearish pressure, XRP needs to maintain a solid position above the upper boundary of the descending channel and reclaim the $2.72 level.
The Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) have dipped below their respective moving averages, highlighting a potential extension of bearish pressures. In contrast, the Stochastic Oscillator is in the oversold area, indicating the possibility of a price rebound.
A daily close below the lower boundary of the descending channel would negate this positive scenario, potentially driving XRP down to $1.35.