Key takeaways:
The number of XRP whale addresses reached a record high of 317,500, highlighting accumulation trends.
XRP’s price must surpass the $2.59 resistance to have a chance at regaining $3.
XRP (XRP) rebounded from Friday’s lows of $2.18, climbing as much as 13% to an intraday peak of $2.48 on Monday.
A robust technical setup and whale activity suggest that the XRP/USD pair is poised for a trend reversal towards $3 soon.
What’s driving XRP’s recovery?
XRP whales maintain confidence regarding the potential for a further rally, leveraging the recent pullback to gather more tokens.
Santiment’s whale count metric reveals that the number of wallets with at least 10,000 XRP has reached an unprecedented high of approximately 317,500.
“XRP’s price has rebounded modestly by +5.3%,” Santiment stated in a post on X this Saturday.
Related: Ripple aims to acquire $1 billion in XRP tokens for new treasury: Report
The market intelligence firm noted that the increasing number of mid to large stakeholders is a “positive long-term indicator,” adding:
“XRP now has over 317.4K wallets holding at least 10K coins for the first time ever.”
This corresponds with a notable decline in XRP supply on centralized exchanges over the last 30 days, according to data from Glassnode.
The chart below illustrates that the percentage of XRP supply on exchanges reduced from 6.12% to 3.9% between September 19 and Sunday.
A decreasing balance on exchanges indicates less liquid supply available for immediate sale, enhancing the bullish potential for XRP.
“Most of the XRP on exchanges is already gone,” noted crypto investor Black Swan Capitalist in a Sunday post on X, adding:
“With so little liquidity remaining, any notable demand will compel the market to absorb the leftover supply instantly. Conditions are favorable for a significant trend reversal.”
As Cointelegraph has reported, Ripple is planning to establish a $1 billion Digital Asset Treasury company.
XRP price must reclaim the 200-day SMA
XRP’s price action has been tracing a potential V-shaped recovery chart pattern on the daily time frame since mid-September, as illustrated below.
A V-shaped recovery is a bullish pattern formed when an asset experiences a rapid price increase following a sharp decline. It completes when the price ascends to the resistance at the top of the V formation, or the neckline.
XRP seems to be on a comparable path, but bulls need to overcome the $2.59 level, where the 200-day simple moving average (SMA) resides, to validate the recovery.
Additional resistance exists in the $2.81 to $2.95 supply zone, marked by the 50-day and 100-day SMAs, respectively.
If surpassed, the subsequent logical target would be the neckline at $3.40, completing the V-shaped pattern. This represents a 26% increase from the current price.
XRP analyst Egrag Crypto highlighted key levels to monitor, stating that a “close above $2.55 to $2.65 on the 3-day time frame would signal bullish momentum!”
Meanwhile, the Bollinger Band width, a technical indicator traders use to assess momentum and volatility, has reached its tightest point since June, indicating that a significant price move may be imminent.
The last instance of such tight bands resulted in a 66% rebound in XRP price from its multi-year high of $3.66 down to $2.20.
As Cointelegraph noted, the 20-day EMA at $2.63 is a crucial level for bulls, as a break above could propel XRP price towards $3.40.
This article does not constitute investment advice or recommendations. Every investment and trading decision carries risk, and readers should perform their own research prior to making decisions.
