Ripple (XRP) Price Analysis: Can It Drop Below $0.50?

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The price of Ripple (XRP) is in an uncertain phase. The 7-day RSI shows that it is neither overbought nor oversold, indicating flat investor interest. The situation worsened when the 7-day moving average of Daily Active Addresses fell by 10% in just four days. This indicates a downward trend in network activity.

Furthermore, a death cross in the EMA lines indicates a possible strong downtrend. This signals XRP investors to be cautious.

RSI is currently neutral

TheXRP market is showing signs of investor disinterest. The 7-day Relative Strength Index (RSI) stands at 49.5. This number is near the middle of the RSI spectrum. It indicates lukewarm sentiment towards XRP without strong buying or selling momentum.

The RSI measures the speed and changes of price movements. It ranges from 0 to 100. An RSI above 70 means an asset is overbought and could fall. Below 30 means it is oversold and could rise.

XRP RSI 7D. Source: Santiment.

Therefore, XRP’s current RSI signals a market equilibrium that translates into a lack of compelling interest among traders. This apathy is further evidenced by the fact that the current RSI value is the low it has been since February 28. Such a dip to levels near the midrange on either side suggests a cooling of previous enthusiasm or pessimism, potentially marking the start of a bearish phase for Ripple.

Due to a weakening of buying pressure or an inability to attract new interest, this decline in the RSI can be interpreted as a bearish signal for XRP, warning investors of the possibility of diminishing returns.

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Daily active addresses are decreasing

XRP has shown a fascinating correlation between Daily Active Addresses and the price. Initially, from March 7 to March 11, there was a sharp increase in Daily Active Addresses, from 29,246 to 37,724. This increase coincided with an increase in network activity.

This increase in network activity coincided with a notable increase in the price of XRP, which shot up from $0.61 to $0.72. However, this trend was reversed. However, this trend reversed when on March 20, the number of Daily Active Addresses fell to 26,848, which was accompanied by a decline in the price of XRP to $0.57, further strengthening the link between network activity and price appreciation.

XRP Daily Active Addresses and 7D Moving Average. Source: Santiment.

The recent period from March 29 to April 2 shows a continuation of this trend, with the 7-day moving average of Daily Active Addresses falling from 33,684 to 30,559, a decline of 10%. This decline indicates declining interest in Ripple as fewer addresses transact on the network.

Given the observed correlation between these two metrics in recent months, this drop in Daily Active Addresses could be a harbinger of further course corrections for Ripple.

XRP Price Forecast: A Death Cross could bring the price below $0.50

The XRP 4H price chart recently revealed a strong technical pattern on April 1: the formation of a death cross. A death cross occurs when a shorter term EMA crosses below a longer term EMA. EMA lines, or Exponential Moving Averages, are vital indicators that smooth price data to reveal trend direction over specific time frames.

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This event is traditionally seen as a bearish signal, suggesting that current price momentum is weakening and could indicate a potential decline in the price of XRP. Furthermore, the increasing distance between these two EMA lines strengthens the bearish trend, indicating that selling pressure is increasing and negative sentiment is gaining momentum.

XRP 4H Price Chart and EMA Lines.
XRP 4H Price Chart and EMA Lines. Source: TradingView.

If this bearish trend continues, XRP price is likely to test critical support levels at $0.54 and $0.53. If the price fails to hold these levels, it could be pushed lower to test a more substantial support at $0.49.

Conversely, if a reversal occurs and an uptrend begins, XRP’s price could challenge resistance levels around $0.66 or even highs at $0.70.

Disclaimer

All information on our website is published in good faith and for general information purposes only. Any action the reader takes based on the information on our website is strictly at his own risk.

The article is in Dutch

Tags: Ripple XRP Price Analysis Drop

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