Could XRP be set for another repeat of July’s rally?
- Addresses holding 10,000 to 10 million XRP increased the value of the token in their portfolio.
- XRP may not be able to hold on to its hike following a series of profit-taking despite increases in volume and open interest.
The price of Ripple [XRP] climbed to $0.53 for the first time in 10 days. For some weeks, XRP has been hovering between $0.48 and $0.52 as it and many other altcoins continue to show signs of weakness following Bitcoin’s [BTC] renewed dominance in the market.
Read Ripple’s [XRP] Price Prediction 2023-2024
On Schedule to join its peers
But like Injective [INJ] and Solana [SOL], XRP seems to be on the right track to a consistently impressive performance, and this was due to some events that took place backstage. According to Santiment, the price increase could be linked to the hike in accumulation by addresses holding 10,000 to 10 million XRP.
🐳📈 #XRPLedger enjoyed its first jump above $0.53 in 10 days despite most #altcoins continuing to decline. The rise can largely be attributed to the ‘smart money’ tiers, holding between 10K to 10M $XRP, accumulating rapidly. They hold 29.5% of the supply. https://t.co/KULxMtMGRL pic.twitter.com/LTzFcrwG3f
— Santiment (@santimentfeed) October 20, 2023
The on-chain analytic platform mentioned that this cohort has been scooping up XRP at a quick pace. Usually, buying pressure of this sort impacts price action positively. But that did not seem to be the only catalyst that drove XRP’s 5.83% uptick in the last 24 hours.
Interestingly, the accumulation coincided with the period when the U.S. SEC dropped all its charges against Ripple’s executives Chris Larsen and Brad Garlinghouse. As expected, this was a big win for the XRP Army who have been at loggerheads with the regulator for years.
Also, there has been speculation that the event could spring up a repeat of July’s rally when the token was proclaimed not to be a security. As a result of that judgment, XRP’s value jumped almost 100% within a few hours. But could that be the case now?
To find out the possibility, the open interest is one metric that could be very useful. Open interest is the total number of outstanding contracts in the market at the end of a trading day.
When the open interest increases, it means that there is high liquidity in the market. On the other hand, a decrease implies that a lot of positions are being closed.
Not every increase can birth a rally
At the time of writing, XRP’s open interest increased. When combined with the price action, it means that the value could increase further, and from the indicator, the token could reach $0.60 in the short term. However, that could only be the case if the open interest sustains its hike.
Source: Coinglass
Another metric that might have an impact on the price is the volume. Based on Santiment’s data, XRP’s 24-hour volume went from 730.11 million to 1.67 billion. This increase was a testament to the increase in transactions around the token.
Is your portfolio green? Check the XRP Profit Calculator
Typically, rising volumes on increasing price is a sign of strength for an upward movement. So, if XRP’s volume continues to increase and selling pressure doesn’t halt the cryptocurrency’s uptick, it is likely to see the price close or above $0.60.
Source: Santiment
However, there has been some profit-taking within the last few hours as XRP plunged to $0.51. Consequently, traders are betting on the price to decrease further as indicated by the funding rate which was -0.007% at the time of writing.
