XRP’s current price decline is attributed to a recent episode of market volatility triggered by rumors surrounding a potential BlackRock exchange-traded fund (ETF) focused on XRP. On November 13, the cryptocurrency experienced a 12% surge, reaching approximately $0.75, as a result of speculation related to the BlackRock ETF. However, this surge proved short-lived, with Bloomberg’s ETF analyst Eric Balchunas debunking the rumor and causing a rapid return to XRP’s initial value for the day.
The subsequent market correction led to substantial liquidations, particularly impacting long position holders. Between November 13 and 14, the derivatives market saw long liquidations totaling $17.5 million, significantly outweighing the $2.87 million worth of short positions liquidated during the same period, according to Coinglass.
The repercussions of the BlackRock XRP ETF rumor continued to influence XRP’s price trajectory throughout the week, contributing to its underperformance compared to the broader cryptocurrency market. As of November 17, XRP’s price has declined by nearly 9.5% week-to-date, including a 7.5% drop in the last 24 hours. This downward trend aligns with market behaviors observed in other leading cryptocurrencies, although XRP has experienced a more pronounced decline.
Additionally, the decrease in the holdings of XRP’s wealthiest addresses has added to the overall weakness in XRP’s price. Addresses with balances ranging from 100,000 XRP to 100 million XRP have seen a modest reduction in supply since the BlackRock ETF rumor. Conversely, the 100 million to 1 billion XRP balance cohort has witnessed a slight increase of 0.11%.
From a technical perspective, XRP/USD has been moving within a large ascending channel since June 2022. The current correction phase, initiated after testing the upper trendline of the channel as resistance, raises the possibility of a decline towards the lower trendline, approximately $0.50, representing an 18.5% decrease from the current price levels. Notably, this downside target aligns with XRP’s 50-week (red wave) and 200-week (blue wave) exponential moving averages (EMAs) and historically served as support between March 2021 and January 2022.
Conversely, a decisive breakout above the current resistance level near $0.75 could propel XRP toward $1.13 in 2023 or early 2024, marking an increase of over 80% from the current price levels.
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