XRP to likely continue rising even as key whale addresses move to sell

XRP price rose by more than 3.3% in the last 24 hours to breach the resistance of $0.667.
Ripple whales have managed to sell over 60 million XRP worth $40 million in three days.
The MVRV ratio shows that the altcoin still has room to rally before actually suggesting profit-taking.

XRP price is moving upwards once again, and that is considered by many to be a positive sign for their portfolios. Interestingly, though, some have been a little too quick in picking up this signal, which has resulted in the selling of the Ripple native token ahead of time.

Daily Digest Market Movers: Ripple whales step forward to sell

Ripple whale addresses have shown a tendency to book profits a little ahead of time in the past as well, which generally results in selling before the price can hit the local peak. A similar behavior can be observed at the moment as well.

Whale addresses holding 1 million XRP to 10 million XRP tokens have sold over 60 million XRP worth over $40 million in the span of three days. Consequently, their holding currently stands at 3.72 billion XRP. These whales sold their supply just as the XRP price began rising in the last three days, including the increase in the last 24 hours where the altcoin shot up 3.68% over the past 24 hours.

Ripple whale holdings

However, their move was a little earlier than expected since, according to the Market Value to Realized Value (MVRV) ratio, these investors still had some room to grow. The MVRV ratio is an indicator that is used to assess the average profit/loss of investors who purchase an asset. The 30-day MVRV ratio measures the average profit/loss of investors who purchased an asset in the past month.

For Ripple, the 30-day MVRV sits at 6.7%, which indicates that investors who purchased XRP in the past month are sitting at 6.7% profit. These investors are likely to sell their holdings to realize profits; when MVRV hits 8% to 20%, XRP has undergone major corrections. If a similar outcome is observed this time around, it could trigger a sell-off, which is why this area is termed a danger zone.

Ripple MVRV ratio

Since MVRV is yet to reach there, the whales’ move appears to be a little premature, which also suggests that the XRP price might have room to grow.

Technical Analysis: XRP price rise restarts

XRP price, at the time of writing, was trading at $0.667, marking a 3.68% increase over the past day. The rise began over the past few days and pushed the altcoin to break through a key barrier at $0.644.

This resistance was last breached nearly three weeks ago, which marks a recovery for XRP price. Testing this line as support again would set the altcoin up for rising to $0.700. The price indicators are already hinting towards active bullishness, which is key to further recovery.

XRP/USD 1-day chart

However, if the cryptocurrency fails to breach the resistance at $0.693, XRP price might see a fall back to $0.644, and losing this support level would invalidate the bullish thesis, causing a decline to $0.600.

Cryptocurrency metrics FAQs

What is circulating supply?

The developer or creator of each cryptocurrency decides on the total number of tokens that can be minted or issued. Only a certain number of these assets can be minted by mining, staking or other mechanisms. This is defined by the algorithm of the underlying blockchain technology. Since its inception, a total of 19,445,656 BTCs have been mined, which is the circulating supply of Bitcoin. On the other hand, circulating supply can also be decreased via actions such as burning tokens, or mistakenly sending assets to addresses of other incompatible blockchains.

What is market capitalization?

Market capitalization is the result of multiplying the circulating supply of a certain asset by the asset’s current market value. For Bitcoin, the market capitalization at the beginning of August 2023 is above $570 billion, which is the result of the more than 19 million BTC in circulation multiplied by the Bitcoin price around $29,600.

What is trading volume?

Trading volume refers to the total number of tokens for a specific asset that has been transacted or exchanged between buyers and sellers within set trading hours, for example, 24 hours. It is used to gauge market sentiment, this metric combines all volumes on centralized exchanges and decentralized exchanges. Increasing trading volume often denotes the demand for a certain asset as more people are buying and selling the cryptocurrency.

What is funding rate?

Funding rates are a concept designed to encourage traders to take positions and ensure perpetual contract prices match spot markets. It defines a mechanism by exchanges to ensure that future prices and index prices periodic payments regularly converge. When the funding rate is positive, the price of the perpetual contract is higher than the mark price. This means traders who are bullish and have opened long positions pay traders who are in short positions. On the other hand, a negative funding rate means perpetual prices are below the mark price, and hence traders with short positions pay traders who have opened long positions.

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