After taking profits in late March and early April, major institutional investors in Ripple appear to be returning. If other investors also interpret the negative market sentiment as a bullish signal to buy the dip, can XRP price break above $0.6?
XRP Whales Are Buying the Dip
XRP price lost the critical support at $0.50 last week. However, a large group of investors holding between 1 million and 10 million tokens are buying the dip. According to Santiment’s on-chain data, this group of price-savvy whales has added 80 million bitcoins to their wallet balances in the past 2 weeks.
XRP price and balance Whale wallets for April 2023 | Source: mood
At the current market price of $0.455, the newly added XRP is worth $36 million. A positive divergence between the price and the buying trend of whales can be a great indicator that the price is about to recover.
Overall, when whales continue to buy during price corrections, it reaffirms confidence in the underlying technology and products built on top of the Ripple network. Furthermore, considering how successfully this group of whales have held on to past bull markets, it is only a matter of time before XRP enters another bull run.
Ripple market sentiment nears 2-month low
At the end of March, the Ripple ecosystem became ecstatic when news broke that the infamous lawsuit with the US Securities and Exchange Commission (SEC) might be won. On-chain indicators now suggest that the market boom may be over. As of April 24, the XRP weighted sentiment was -0.57, the lowest level since February 2.
XRP price and Psychology has Weighted April 2023 | Source: Santiment
Overall, sentiment-weighted tracks the market’s view of a particular asset by comparing the ratio of positive social mentions to negative mentions. When sentiment-weighted sentiment falls to new local lows, it usually signals an imminent bearish trend reversal.
XRP Price Prediction: A rally above $0.50 is likely
Over the past week, XRP holders have optimistically defended the $0.45 support level. However, according to on-chain data, 2022 is the last time XRP’s Market Cap to Real Value (MVRV) ratio will drop to current levels. This is followed by a 12% price increase in November and December 2022. Hence, this suggests that Ripple’s altcoin may be on the rebound.
XRP price and April 2023 MVRV rate | Source: Santiment
However, the bears can still turn the tables if the XRP price falls below $0.45. But historically, XRP investors have generally avoided losses below the 10% range. Therefore, if they want to continue to rise strongly, they must hold this support level.
However, if the support at $0.45 is lost, XRP could continue with an 18% drop to $0.41. If that happens, it’s likely that most holders will stop selling and inadvertently trigger a recovery.
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