- XRP whales transfer large amounts of coins, while the overall number of whale accounts grows
- The token’s 4h and daily charts hint at bearish continuations and show consolidation.
Yerevan (CoinChapter.com) – XRP, the native token of Ripple Labs blockchain company, started the week in negative territory.
The XRP/USD exchange rate slipped to $0.62 following the London opening bell Monday. The move downside appeared as a correction after a bullish weekend session, apprehensively over fears about a large XRP transfer from a wallet that belonged to a whale. The entity transferred about $18 million worth of XRP (26M coins) to an unknown wallet, as per data provided by WhaleAlert last Thursday.
XRP whales are entities whose wallets contain over 10 million XRP tokens. Of late, the number of such whales has increased. For instance, in the first quarter of 2021, the number of whale wallets grew from 308 to 319. Furthermore, data analytics firm CryptoQuant noted that the accumulation of XRP tokens in the mentioned wallets generally suggests a bullish uptrend in the Ripple market.
However, large transfers from whales to unknown wallets escalate the fears of whale dumping, significantly lowering the concerned token’s price. Conversely, whales also tend to buy the token at a low price, thus improving its upside sentiment. For example, in early June, a Bitcoin whale wallet that had dumped thousands of BTC at its local top started ‘buying the dip’ again.
As the whales have the potential to move markets either ways by excessively buying or selling an asset, traders tend to watch rich wallets to determine their short-term bias in the market. Hence, sudden large transfers in the Ripple market are alarming.
The latest precedent of a 26 million XRP displacement, followed an even larger, $176 million coin transfer on June 12, and a 139 million coin transfer on May 26.
… trade near a significant line of $0.63. The margin has provided both support and resistance since November 2020.
The 4h chart also revealed a symmetrical triangle formation. The bottom trendline with a positive slope kept the token from slumping in the past few sessions. The upper line controlled the uptrends since June 24. As the symmetrical triangle is a continuation pattern, it suggests a bearish bias in the future sessions, as the period preceding the formation has been bearish. The price could drop as low as the next support/resistance margin at $0.50.
Also, the breakout attempts were restricted by the 50-4h simple moving average (SMA-50), which the token retested early in the early hours of the Asian-Pacific session Monday, correcting downward.
The daily chart also revealed a significant support line that has been relevant since early April. If the token adopts a bearish bias in the upcoming sessions, it could face the said trendline again after retesting the $0.50 support. On the other hand, if XRP manages to log a bullish uptrend, the SMA-200 could cap the bullish bias.
Ripple’s money transfer token consolidated around the $0.64 price margin for the past few sessions. The consolidation coincided with a $26 million transfer from a whale account to an unknown wallet on Thursday, June 24. Such substantial transfers generally tend to raise anxiety levels among traders, hinting at a possible whale dump.
However, as of the moment, no big sell-offs have been reported.