In a recent analysis, well-known crypto trader and analyst, Michaël van de Poppe, delved into the factors contributing to the downward trajectory of XRP following a favorable Ripple case ruling.
Van de Poppe identified two primary reasons for the retracement and also pinpointed an attractive entry point for investors on the weekly timeframe.
Michaël van de Poppe: Two Major Factors
One significant factor behind XRP’s retracement, as highlighted by Van de Poppe, is the increasing number of long-term investors who have held onto XRP for about 1.5 years, now seizing the opportunity to exit their positions.
XRP’s recent rally propelled the asset to levels not seen in over a year. The last time the token reached the $0.90 territory was in March 2022.
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Consequently, investors who procured XRP during this period are capitalizing on the opportunity to sell, creating additional selling pressure that contributes to the price decline.
According to van de Poppe, the second reason for the decline lies in the lack of confidence among potential buyers, which has resulted in their hesitancy to enter the market.
The uncertainty surrounding the potential appeal by the US Securities and Exchange Commission (SEC), coupled with the recent decision in the SEC vs. Terra case by Judge Jed Rakoff, has further exacerbated this lack of confidence.
Potential Entry Points
To navigate these turbulent market conditions, experienced traders like Van de Poppe focus on identifying historical support zones that present entry opportunities.
In this instance, Van de Poppe suggests that the weekly timeframe is particularly relevant, as corrections during bearish phases carry more weight compared to the slight corrections observed in bull cycles.
Van de Poppe shares a weekly XRP chart, emphasizing that the current conservative sentiment in the market makes these corrections more significant. As investor faith dwindles, the price retraces to levels observed around 470 days prior.
Read Also: Ripple CLO States Why XRP Security Status Remains Unchanged Despite Terra Case Ruling
The analyst marks a green area, indicating a price range of $0.45 to $0.56, which he identifies as a potential retest on the weekly timeframe and a highly indicative entry point for the upcoming cycle.
What about $XRP?
It's retracing it's entire move.
Why is that?
– Investors finally getting the chance to get out after holding for 1.5 years.
– Buyers not stepping in due to lack of confidence.Therefore, spot for obvious entry points.
The weekly timeframe has one. pic.twitter.com/yCwIGbnpPA
— Michaël van de Poppe (@CryptoMichNL) August 6, 2023
Despite the retracement, XRP has managed to hold above the $0.60 price level, currently trading at $0.6181. Over the past week, XRP has experienced a 12% decline, according to CoinMarketCap.
It is important to note, however, that the crypto market remains highly volatile and unpredictable. Therefore, investors should view this analysis as educational insight into XRP’s price trajectory rather than investment advice.
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