Key takeaways:
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The number of XRP whale addresses hits 317,500 record highs, indicating accumulation.
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XRP price must break the $2.59 resistance first for a chance to regain $3.
XRP (XRP) bounced from Friday’s lows of $2.18, rising as much as 13% to an intraday high of $2.48 on Monday.
A strong technical setup and whale activity showed that the XRP/USD pair was primed for a trend reversal toward $3 in the coming days.
What’s behind XRP’s rebound?
XRP whales remain confident about the prospects of a further rally, using the recent pullback to accumulate more tokens.
Santiment’s whale count metric indicates that the number of wallets holding at least 10,000 XRP has reached an all-time high of roughly 317,500.
“XRP’s price has rebounded back a modest +5.3%,” Santiment said in an X post on Saturday.
Related: Ripple seeks to buy $1 billion XRP tokens for new treasury: Report
The market intelligence firm explained that the amount of mid to large stakeholders continues to grow is a “good long-term sign,” adding:
“XRP now has over 317.4K wallets holding at least 10K coins for the first time in history.”
This aligns with a sharp decrease in XRP supply on centralized exchanges in the past 30 days, according to data from Glassnode.
The chart below shows that the percentage of XRP supply on exchanges dropped to 3.9% from 6.12% between Sept. 19 and Oct. 19.
A reducing balance on exchanges suggests less supply that can be immediately sold, reinforcing the upside potential for XRP.
“The majority of XRP on exchanges is already gone,” said crypto investor Black Swan Capitalist in a Sunday post on X, adding:
“With so little liquidity left, any significant demand will force the market to absorb the remaining supply instantly. Conditions are ripe for a major trend reversal.”
As Cointelegraph reported, Ripple is planning to build a $1 billion Digital Asset Treasury company.
XRP price needs to reclaim the 200-day SMA
XRP’s price action has been following a potential V-shaped recovery chart pattern on the daily time frame since mid-September, as shown below.
A V-shaped recovery is a bullish pattern formed when an asset experiences a sharp price increase after a steep decline. It is completed when the price moves up to the resistance at the top of the V formation, also known as the neckline.
XRP appears to be on a similar trajectory, but bulls need to flip $2.59, where the 200-day simple moving average (SMA) sits, to confirm the recovery.
Another stiff barrier lies within the $2.81 and $2.95 supply zone, which is bounded by the 50-day and 100-day SMAs, respectively.
Higher than that, the next logical move would be the neckline at $3.40 to complete the V-shaped pattern. This would represent a 26% increase from the current price.
XRP analyst Egrag Crypto highlighted the key levels to watch, saying that a “close above $2.55 to $2.65 on the 3-day time frame would be a strong bullish signal! ”
Meanwhile, Bollinger Band width, a technical indicator used by traders to assess momentum and volatility within a certain range, has reached its tightest point since June, signalling that a significant price move may be underway.
The last time the bands were this tight, it led to a 66% rebound in XRP price from its multi-year high of $3.66 from $2.20.
As Cointelegraph reported, the 20-day EMA at $2.63 is a critical level for the bulls to overcome, as a break above could propel XRP price toward $3.40.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
