Has XRP Price Jump Hit a Local Top? Indicators Have the Answer | Airdrop Alert Pro

Ripple’s XRP has surged 25% over the past seven days, reaching a high of $2.72. However, recent data suggests that the rise in XRP price may have reached a local top due to changes in the status of several indicators.

While the long-term outlook for altcoins may remain positive, investors may need to remain cautious about further gains in the short term. That’s why.

Ripple Coin Is Overvalued, Need to Buy Pressure Tanks

One indicator shows XRP may halt its rally is the ratio of Network Value to Transactions (NVT). The NVT ratio checks whether a cryptocurrency’s market capitalization is growing faster than its trading volume. It is a key metric in assessing whether a coin is overvalued or undervalued.

When this ratio decreases, it means that the transaction volume on the blockchain has exceeded the growth of market capitalization. In this case, it means that the cryptocurrency is undervalued and the price may be close to rising.

However, in the case of XRP, the NVT ratio increased from 30.68 to 71.65 in the past three days. This notable surge shows that the cryptocurrency’s market capitalization is growing faster than Transactions on the Internetsuggesting that XRP price gains may be pausing and the altcoin may be close to hitting a local top.

Beyond that, the Money Flow Index (MFI) on the daily chart seems to support this thesis. The MFI is a technical oscillator that uses price and volume to measure buying and selling pressure.

With this data, the indicator can also tell when a cryptocurrency is overbought or oversold. When the reading exceeds 80.00, it is overbought. On the other hand, when it is below 20.00, it is oversold.

As shown in the chart below, the MFI on the daily chart of XRP/USD reached 83.20 on December 3, indicating that the altcoin has become overbought. The ratings have since declined, indicating Buying pressure It’s no longer as high as it was a few days ago. If the decline continues, then the price of XRP may have a hard time climbing higher.

XRP Price Prediction: Sub-$2 Levels Are Coming

Further evaluation of the daily chart suggests XRP callback A move from $2.72 helped it find support at $2.25. However, the chart below shows that the altcoin’s trading volume is low, suggesting that another XRP rally may not be on the way in the short term.

Instead, bears may try to push the price further below the support defended by bulls. If this happens, the price of XRP could drop to $1.85, where the 23.6% Fibonacci ratio lies.

If the selling pressure intensifies, the next target for the coin could be around $1.40, the 38.2% Fib level. However, if buying pressure increases and MFI readings rebound, this prophecy Probably won’t happen. In that scenario, XRP Could Climb Higher It broke above $2.90 and reached a yearly high of $3.20.