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XRP has struggled to close above the $0.60 threshold, indicating a pressing need for stronger institutional support to facilitate a rally.
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As of now, inflows into XRP have drastically lagged behind other cryptocurrencies such as Solana, which raises concerns regarding its market momentum.
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Victor Tan, CEO of TrinityPad, stated, “XRP could see modest growth if Ripple secures more institutional partnerships or regulatory clarity.”
This article delves into XRP’s recent struggles, the necessity for institutional support to spur growth, and its current undervaluation according to MVRV metrics.
XRP Struggles for Momentum as Institutional Support Lags
XRP has been facing significant challenges, failing to maintain a closing price above the critical level of $0.60 for the past four months. Despite these hurdles, the cryptocurrency has managed to hover above a crucial support level, which has kept investor sentiment somewhat optimistic. To regain bullish momentum, XRP must attract more interest from institutional investors, which remains a pivotal factor in its potential recovery and price appreciation.
Institutional Interest Remains Low
Throughout October, institutional investment in XRP was notably subdued, recording only $2.3 million in inflows. This figure starkly contrasts with other altcoins such as Solana and Litecoin, which attracted $17.9 million and $4.5 million, respectively. The limited inflow into XRP underscores the cautious sentiment prevalent among institutional investors, signaling that the potential for a substantial rally hinges on renewed interest. For XRP to move forward in November, bolstered support from institutions will be essential.
Undervalued Yet Undermined by Market Sentiment
Although XRP’s current market position suggests it is undervalued—as indicated by the Market Value to Realized Value (MVRV) ratio—this alone is not sufficient to trigger a market rebound. The MVRV indicates that XRP has not yet hit the “opportunity zone,” characterized by a decline beyond -13%, which typically denotes significant losses for holders. Traditionally, falling into this zone prompts a shift from selling to buying, offering some stabilization potential. However, without a substantial change in market sentiment or triggering event, XRP may linger in this undervalued territory.
Examining Resistance Levels and Future Price Predictions
XRP’s price dynamics reveal challenges near the 38.2% Fibonacci Retracement level positioned at $0.52. This level has recently acted as a support floor but has proven fragile, evidenced by recent dips below it. Investors appear to be adopting a cautious strategy, fearing further declines. If broader market conditions do not shift towards bullishness, XRP’s price recovery may be sluggish, leading to a prolonged consolidation phase trapped between $0.52 and $0.55.
Potential Bearish Scenarios
Should XRP experience continued bearish pressure, a regression towards $0.47 seems likely, aligning with the 23.6% Fibonacci level, often recognized as a bear market support threshold. This critical level has the potential to act as a buffer against further downturns; however, a breach below this level would invalidate any remaining positive outlook and could lead to deeper price corrections.
Conclusion
The path ahead for XRP appears challenging, with a persistent need for institutional backing and a potential rally contingent on renewed market interest. If XRP fails to capture institutional sentiment, it risks remaining range-bound between critical levels, further entrenching it in a state of stagnation. Investors should remain vigilant for any developments that could shift sentiment, as these could provide the necessary momentum for price recovery and stabilization.
