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    Why is XRP price down today?

    2023.09.05 | exchangesranking | 1894onlookers

    Why is XRP price down today?

    XRP  price is down today, akin to declines witnessed elsewhere in the cryptocurrency market.


    XRP underperforms crypto market

    XRP price dropped nearly 1.5% to $0.50 on Sep. 5, underperforming the broader crypto market, which fell about 1% in the same period. The drop coincided with the U.S. dollar index's (DXY) rise. The dollar's correlation with cryptocurrencies has been consistently negative since July.

    XRP/USD versus crypto market capitalization's daily performance chart. Source: TradingView

    XRP's decline appears to be part of a sideways consolidation trend. Traders are buying and flipping XRP for a profit as soon as the price increases. Thus, they have kept its price trapped inside a narrow trading range of $0.49-0.51.

    XRP decline precedes potential whale dump

    One of the possible reasons behind increased XRP sell-pressure is likely large whale transfers.

    For instance, on Sep. 3, an anonymous address sent 29.7 million XRP tokens worth around $15 million to the BitStamp exchange. The amount isn't that large to affect XRP market trends, but its sender is the 98th richest XRP holder — a whale, according to data tracked by CoinCarp.

    A look through XRP's supply among whale addresses further indicates distribution among most cohorts. For instance, the XRP supply held by entities with a balance between 1 million and 10 million tokens (brown) has declined since Sep. 3.

    XRP supply among whales. Source: Santiment

    Similarly, XRP supply held by whales with a balance between 100 million and 1 billion tokens (green) has dropped in the same period. Interestingly, the 10 million-100 million XRP balance cohort (black) has absorbed the supply from the 100 million-1 billion balance cohort.

    XRP price analysis for September

    From a technical standpoint, XRP appears to have entered the breakdown stage of its prevailing bear pennant pattern.

    A bear pennant is a bearish continuation pattern, characterized by the price consolidating inside a range defined by a falling trendline resistance and a rising trendline support. It resolves after the price breaks below the lower trendline and falls by as much as the previous decline height.

    XRP/USD daily price chart. Source: TradingView

    As a result of this technical analysis rule, XRP price risks falling toward $0.40 in September 2023, about 20% lower than current price levels. 

    Conversely, a close above XRP's 200-day exponential moving average (200-day EMA; the blue wave) near $0.52 may invalidate or delay the bear pennant breakdown. Instead, the price is poised to rise toward the pennant's upper trendline near $0.54 or the 50-day EMA (the red wave) near $0.56.

    This bullish scenario can result in a 7-15% price rally in September from current price levels.


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