Earlier this month, the price of Ripple (XRP) fell 18% within three days. However, since October 3rd, the token has been stable, trading between $0.52 and $0.55.
Big players in the market are accumulating XRP, which could increase its value, but it is unclear whether this will be enough to prevent the token from falling below $0.50.
Ripple Bulls show support for altcoins
Addresses holding between 100 million and 1 billion XRP owned 9.63 billion tokens as of October 17, according to Santiment. That amount has since increased to 9.77 billion, indicating that approximately 140 million XRP (equivalent to approximately $77 million) has been accumulated.
Typically, when large investors accumulate tokens, it indicates an expectation of price appreciation. Conversely, a decline in holdings often indicates an impending price decline. Considering the recent accumulation, XRP could rise to levels above $0.55.
Read more: XRP ETF explained: What it is and how it works
XRP investor balance. Source: Santiment
Another factor supporting this prediction is the funding rate, which measures the difference between the mark price of a perpetual futures and the index price representing the spot price of the underlying asset.
When the funding rate increases, it indicates that longs are paying shorts and traders are bullish overall. Lower interest rates indicate shorts are paying out longs, reflecting bearish sentiment.
For XRP, the funding rate is currently positive. If this trend continues, the price of the altcoin could rise, providing potential profits for traders holding long positions.
XRP funding rate. Source: Santiment
XRP Price Prediction: Near Bounce
On the daily chart, the price of XRP is fluctuating between $0.52 and $0.54. However, looking at the chart, we can see that the $0.52 level is strong support for the token as the bulls have kept the price from below that point multiple times in recent weeks.
Considering this position, it is highly unlikely that the altcoin will fall below $0.50. Instead, the Fibonacci indicator, which measures support and resistance, reveals that the price of XRP could bounce off that support.
Read more: How to buy XRP and everything you need to know
XRP price analysis. Source: TradingView
Due to increased buying pressure, the value of the cryptocurrency could reach $0.60. However, if XRP falls below $0.52 and the bulls fail to defend the token, the next drawdown could be to $0.49.
Disclaimer
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