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Ripple Continues Trading Low Despite Decreased Supply on Exchanges
Sep. 09, 2024. 1 min. read.
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Despite a seven-month low in exchange supply hinting at reduced selling pressure, Ripple's XRP continues to drop, lacking the demand needed to boost its price.
Ripple’s XRP has seen its supply on cryptocurrency exchanges drop to a seven-month low, a typical indicator of diminished selling pressure that often precedes a price increase. However, despite this reduction, XRP’s price has not shown the expected upward movement and continues to decline.
As of now, 2.58 million XRP tokens, valued at $1.32 million, remain on exchanges—a 28% decrease since February 1, according to analytics firm Santiment. “When the supply of an asset on exchanges decreases, it generally signals that fewer units are available for immediate sale, as investors choose to hold onto their tokens,” Santiment reported. This usually lessens selling pressure and could potentially boost the price if there were a corresponding increase in demand. Unfortunately for XRP, this increase in demand has not materialized.
From a high of $0.71 on March 11, XRP’s price has dropped by 24%, now trading at around $0.53. This decline has significantly affected the profitability of XRP’s supply; only 67.38% remained profitable by July 4, the lowest in 16 months, down from 91.21% in March. However, there has been some recovery, with profitability rising to 76.79%.
The price chart for XRP shows it trading within a horizontal channel since July 17, indicating stabilization between specific resistance and support levels. Recently, XRP’s price dipped below this channel’s support but is now attempting a rally, testing whether it can regain its previous support level. If this retest is successful and demand remains stable, XRP could potentially climb to $0.56 and might even reach $0.60. Conversely, a failure to hold this support could see prices sliding to $0.46, negating any bullish forecasts for the near future.
Source: Ripple (XRP) Supply on Exchanges Drops to Seven-Month Low, Price Fails to React
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