Technical analysis suggests XRP could face a 20% correction in December, with overleveraged positions potentially amplifying downward pressure.
XRP surged 26.50% in the past 24 hours, reaching $1.95 on November 30—its highest level since April 2021. This rally was fueled by rumors that the New York Department of Financial Services (NYDFS) might approve Ripple's RLUSD stablecoin in December.
However, three key indicators point to waning bullish momentum, signaling a potential 20% pullback.
Rising Channel Resistance Tests XRP's Rally
XRP's current ascending channel shows the first signs of exhaustion. On November 30, the price hit the channel’s upper resistance trendline, historically followed by corrections. The 4-hour Relative Strength Index (RSI) also exceeded 80, indicating overbought conditions and potential buyer fatigue.
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Key levels to watch:
- Support: $1.75 (aligned with the channel’s lower trendline)
- 50-EMA: $1.48 (20% below current levels)
Whale Activity Signals Profit-Taking
Addresses holding ≥100,000 XRP reduced their balances by 30 million tokens after November 24, suggesting whales are capitalizing on multi-year highs. This sell-off coincides with XRP nearing its $1.90 resistance level, increasing downside risks.
Leverage Risks Threaten XRP's Stability
XRP’s open interest (OI) spiked 37% to a record $3.19 billion, reflecting speculative trading. Analysts warn this "leveraged pump" mirrors conditions before XRP’s 17% drop in late November. A rapid price decline could trigger cascading liquidations, exacerbating losses.
FAQs
Q: What’s driving XRP’s recent price surge?
A: Speculation about NYDFS approving Ripple’s stablecoin and broader crypto market optimism.
Q: How low could XRP fall?
A: A 20% correction to ~$1.48 is possible if support at $1.75 breaks.
Q: Are whales selling XRP?
A: Yes—large holders reduced their balances by 30 million XRP near recent highs.
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Disclaimer: This content is for informational purposes only and does not constitute financial advice. Always conduct independent research before investing.
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