Numbers and statistics define and explain almost everything we need to know in the financial landscape. For example, 2019 has been collectively accepted as a bullish year for the cryptocurrency market, with a majority of virtual assets boasting incredible growth since the demise of the crypto-winter. However, some of these stats can be slightly misleading.
December 2018 is widely recognized as the low point of the crypto-winter, with all major assets recording major devaluation. In fact, some of these assets fell to levels which were over 90% off from their all-time highs in 2017.
XRP was one such cryptocurrency that dropped down by almost 90 percent in December 2018. While XRP peaked at $3.60 back in the bull run of 2017, its valuation was down to $0.39 the following year.
Fortunately, the crypto-winter ended in April and the market’s resurgence led by Bitcoin and the likes of Litecoin and Binance Coin resuscitated the market. In fact, Bitcoin was at one point up by almost 250 percent this year. However, the
Source: Trading View
When the cryptocurrency market began to rally this year, XRP joined in and climbed its way to its yearly high of $0.475. However, since 22 June, the coin has progressively lost valuation and over the last few days, the token has dipped by almost 23 percent.
At press time, XRP was valued at $0.309, a value lower than the lows of December 2018, the height of the crypto-winter. In 2018, XRP’s low was recorded to be a $0.39, which is still 20 percent more than its current valuation. These figures suggest that despite the larger market rally, XRP itself is hardly having a bullish year.
This is a surprising finding since its parent company, Ripple, has been at the heart of changing the face of modern-day finance. With its numerous collaborations, partnerships and initiatives, Ripple’s stock has surged across the world. Unfortunately, this hasn’t translated to XRP’s price.
However, the digital asset was not the only token facing the repercussions of a decline. The likes of Bitcoin Cash, Tron and Stellar Lumens were also down by almost 90 percent from their all-time high at press time, even after recording positive growth in 2019.
XRP’s correlation to overall market fell towards November-end: Report
The Bitcoin [BTC] market has lost 0.54% of its value in December 2019, with the king coin’s price movement recording recurring dips. A recent dip of 2.45% contributed to the price of the world’s largest crypto tumbling down from $7,450.62 to $7,268.03. Following the loss, Bitcoin tried to recover. However, it was stuck at $7,337.32, at press time. As most cryptos are correlated to BTC, the king coin’s fall impacted the rest of the crypto-market too.
According to OKEx’s recent research report, the king coin “brought back its connectedness” to the overall market, which was slightly higher than Ethereum [ETH].
The research report read,
“BTC brought back its connectedness to the overall market, slightly higher than ETH, which kept the top seat for more than three months. This means not the only market cap, but also its directional movements in overall crypto are ALL on BTC.”
Following the recent volatility in the crypto-market, major tokens on the exchange saw an increased correlation in November 2019, more than the previous month. The report also noted that the overall relationships of the tokens with each other appeared positive.
OKEx’s utility token, OKB, showed a positive correlation to major tokens, irrespective of volatility in the market during November. Even though Ethereum’s connectedness lagged when compared to Bitcoin’s in the month of November, there was a rise in BTC and ETH correlation with other coins.
Similarly, after a close analysis of major tokens during the first and second weeks of November, it was found that XRP showed “growth in relation to other major tokens.”
A comparative analysis of the second and third week of November also reported a higher connection of Tron [TRX] and Ethereum Classic [ETC] to the overall market, along with XRP.
However, as November ended, XRP changed its direction of integration to the overall market. Further, an analysis of the newly introduced BTC/USDT Futures also found that there was minimum correlation to its underlying movements.
XRPL transactions on ODL platform amount to over $100 million in Q4
Transactions executing on Ripple’s On-Demand Liquidity [ODL] platform, previously known as xRapid, is on the rise. The fourth quarter continued to exhibit positive metrics for the XRP ecosystem despite the market’s bearish price momentum. In the latest development, XRP enthusiast, H_M_X revealed that transactions on the MXN corridor amounted to over $100 million out of the total $108 million ODL flow in the fourth quarter.
Source: Twitter | H_M_X
According to the above chart posted by H_M_X, there has been a three-fold increase in ODL flow in the latest quarter [that still has 20 more days to go] as compared to the third quarter which recorded nearly $33 million.
Source: Utility Scan
Data from Utility Scan also suggested an increase in USD volume per corridor in the last 24-hours. The above chart depicted a significant increase in activity in the MXN
Despite the Mexican corridor dominating the charts, Ripple’s Philippines corridor has also noted an uptick in ODL transactions. Interestingly, liquidity Index also noted a spike in the liquidity for PHP/XRP corridor.
ODL utilizes XRP as a bridge asset between multiple support currencies, thus eliminating the need for the traditional Nostro-Vostro accounts. XRP market volume on Bitso recorded significant uptrends, but CoinsPh managed to outpace Bitso recently. H_M_X also spotted the largest ODL transaction conducted on CoinsPh, which clocked 250,000 XRP. According to the XRP proponent, the value was achieved at a rate faster than on Bitso.
XRP may face further losses after closure of falling wedge
Despite the current upside momentum exhibited by the cryptocurrency market, XRP was trading below its crucial $0.23 resistance point and has been tagging slightly above the $0.21 support area. At press time, XRP was trading at $0.22 after posting minor gains of 1.96%.
XRP’s 1-Hour Chart:
Source: XRP/USD on TradingView
XRP’s hourly chart exhibited the formation of a rising wedge pattern with its price bouncing between two up-sloping and converging trendlines. This suggested a potential bearish breakout in the near-term. The decline in volume further provided validity to the pattern formation. On a positive note, however, the moving averages sustained a bullish crossover on December 6th and appeared to be diverging with 50 MA swinging higher, while 100 MA was hovering below it.
This bullishness could indicate that the coin might climb to the immediate resistance at $0.23, a crucial point that has curbed XRP bulls on multiple occasions. Following which the price could suffer a subsequent fall as the wedge comes to closure.
If the trend persists, the coin could see its price fall to the immediate support at $0.21; the next support for XRP was found at $0.20.
Source: XRP/USD on TradingView
MACD sustained a bearish crossover as the leading line slid below signal line. This further indicated a bearish phase for the coin in the near term. RSI indicator was in the overbought zone as it hovered well above 50 median.
XRP’s pattern on its hourly chart indicated a potential bearish breakout following the closure of a rising wedge. The bullish moving averages could possibly suggest the coin could regain ground above $0.22 for a brief period followed by a price slump. Despite high buying pressure among the traders, XRP’s price could revisit $0.21 and $0.20 if the downward pressure continues.