- XRP dips 5%, but analysts predict potential rebound ahead soon.
- Historical trends suggest XRP could rally after 70-day downtrend.
- Ripple expands ecosystem, boosting long-term prospects for XRP’s growth.
XRP has been struggling to maintain its upward momentum as it faces a 5% drop, falling to a low of $1.81. The recent decline has come amid a broader market sell-off, which has affected major altcoins, including XRP.
This marks a significant shift for a cryptocurrency that was one of the top performers earlier this year. As XRP sits below critical price levels, analysts are now turning their attention to the asset’s historical price patterns to predict what could be next for the digital asset.
Since July, XRP has been on a steady downtrend, with each bounce weaker than the one before. The digital asset has spent a significant amount of time below its 50-week Simple Moving Average (SMA), a crucial technical level used to determine the overall market trend. As of now, XRP has been under this key indicator for roughly 70 days, placing it within the historical window that has often preceded strong price rallies.
According to Skipper | XRPL, a noted analyst within the XRP community, “every cycle, when XRP breaks below the 50-week SMA and stays there for roughly 50-84 days, a strong rally has followed.”
With XRP currently in the 70-day range under the 50-week SMA, many believe the asset is on the verge of a significant price rebound. Historical data shows that when XRP has spent similar periods below the 50-week SMA, it has often seen sharp upward price movements once the downtrend reverses.
Also Read: ChartNerd Says XRP Between Moonshot or Major Sweep – Here’s What Could Happen Next
XRP’s Historical Pattern of Rebounds
The 50-week SMA is an important technical indicator that investors closely watch for signs of a trend reversal. Over the years, XRP has followed a familiar pattern: after breaking below its 50-week SMA and staying there for an extended period, it often experiences a powerful rally.
This trend has been evident in past cycles, such as in 2017, when XRP surged by 211% after spending 70 days below the SMA. Similarly, in 2021, XRP gained 70% after a brief dip below the 50-week SMA.
This historical behavior has led many analysts to believe that XRP could be primed for a rebound, with the possibility of a rally similar to previous cycles. If XRP can break through the resistance level at $2.27, a price point reached during a weak bounce in late November, it could signal the end of the current downtrend and open the door to a new bullish phase.
Ripple’s Ecosystem Growth Could Support XRP’s Long-Term Outlook
While XRP’s short-term price action has been disappointing, Ripple’s ongoing efforts to expand its ecosystem could provide strong long-term support for the cryptocurrency. Ripple recently announced the expansion of its RLUSD stablecoin to platforms such as Optimism, Base, Ink, and Unichain.
This move leverages Wormhole’s Native Token Transfers (NTT) standard, which enhances multichain interoperability and positions Ripple as a key player in the growing blockchain space.
As Ripple expands its presence, the demand for XRP could rise, especially as the company continues to drive innovation within the cryptocurrency space. This increasing adoption and utility could help support XRP’s value, even if it faces short-term price fluctuations.
What’s Next for XRP?
XRP’s immediate future hinges on whether it can break free from its current downtrend. Analysts will be watching closely to see if the cryptocurrency follows its historical pattern of recovery after spending time below its 50-week SMA. If XRP can push past the $2.27 resistance level, it may mark the start of a new upward movement.
At the same time, Ripple’s ongoing expansion into new platforms and its focus on improving XRP’s utility could provide a solid foundation for long-term growth. The coming weeks could be crucial in determining whether XRP will follow the established pattern of a strong rebound or continue to struggle amid broader market challenges.
Also Read: Crypto.com Enhances Fiat Payment System with DBS Bank in Singapore
