XRP price has seen a hard down move in the early hours of the Asian market (9am Tokyo). Within 45 minutes, the price dropped from $0.3394 to $0.2998, meaning XRP saw a whopping 12% drop.
Notably, the move did not come in line with broader market sentiment as BTC and ETH meanwhile saw small gains. It’s also worth noting that the sudden price drop happened seemingly without any real Ripple-related news, such as: B. a new development in the legal dispute with the US Securities and Exchange Commission or the XRP token. Therefore, the price action seems to be mainly influenced by speculation.
However, as of press time, the price had already managed to bounce back to $0.3322, erasing much of the sudden price drop. XRP is now facing resistance at $0.3333 which has not yet been broken.
XRP price 1 hour chart
There is one event that often draws the attention of XRP investors on the first of the month, the unlocking of 1 billion XRP from Ripple’s escrow, which took place yesterday, Sunday. Under normal circumstances, this should not have caused the sudden sell-off. The promotion has been known in the community for years, although this time there was a small surprise.
While previously XRP was unlocked directly from Ripple escrow accounts, this time it happened on unknown accounts, according to Whale Alert. However, Bithomp identified the addresses as those of Ripple.
🔓 🔓 🔓 🔓 🔓 🔓 🔓 🔓 🔓 🔓 500,000,000 #XRP ($170,074,826) unlocked from escrow at unknown wallethttps://t.co/yymqzSjLYk
— Whale Alert (@whale_alert) January 1, 2023
Yesterday, Ripple CTO Schwartz asked himself why the XRP price is currently doing so poorly and answered:
I don’t really have a good understanding of what affects the price of cryptocurrencies. But I will tell you what I believe to be true, although I have no facts to back it up. It’s just my feeling based on data, experience and maybe just feelings.
Other downsides to XRP price?
Today’s move could mean further disadvantages for the price. The recent rejection at the key $0.37 resistance should play a role in this. On the plus side, if XRP revisits the $0.343 level relatively soon, it would be of significant significance to investors. Otherwise, there could be plenty of liquidity on the downside, as today’s move has also shown.
Looking at the 1-day chart, a retest of the $0.2641 level would be the most bearish scenario for now. The price level could represent massive support where liquidity could already be kicking in.
Investors should keep an eye on the $0.3205 level for now. If this breaks, the 6-month low at $0.2870 would be another area where XRP could see a bounce.
XRP price, 1 day chart
Featured image from iStock, charts from TradingView.com
