Ripple XRP support at $0.50 faded on April 20 as bears forced a drop to $0.47. But the low NVT ratio and resilient whales give hope for an imminent recovery. Can XRP price go above $0.60?
After the industry-wide rebound, XRP fell by 12% and lost the $0.50 support level for the first time in April 2023. However, on-chain fundamentals suggest that the downtrend may be short-lived.
XRP is undervalued at current prices
The ratio of network value to transaction volume indicates that XRP may be undervalued at current prices. The NVT ratio evaluates the intrinsic value of an asset by comparing market capitalization growth to transaction volumes.
The red line in the chart below shows that the XRP NVT percentage has been trending downward since the beginning of the week. Between April 15th and April 21st, it decreased by 80% from 355.87 to 79.85.
The NVT ratio is an important tool for investors to assess the fundamental value of a cryptocurrency and assess its growth potential. When it drops significantly, it can indicate a higher rate of growth compared to the current volume of transaction activity.
Currently, low values of the XRP NVT ratio indicate that the coin is undervalued. Strategic investors are likely to interpret this as the perfect timing to buy.
XRP whales stand firm with 8 billion coins
Crypto Whales holding between 100,000 to 100 million XRP has maintained its support despite the recent volatility in the altcoin markets.
Santiment’s on-chain data shows that the whale group has maintained cumulative wallet balances of more than 8 billion XRP coins since late March.
Looking at the chart below, its current total balance of 8.07 billion coins is an increase of 250 million from the 7.82 billion XRP recorded on March 24.
The newly added 250 million coins are worth approximately $120 million at current market value. If the whales maintain their optimistic outlook for the coming days, XRP is likely to hold the $0.45 support.
XRP Price Prediction: The bulls could hold the $0.45 support
Over the past week, bullish XRP holders defended the $0.45 support level. According to Santiment’s Market Value Realized Value (MVRV) data, a price recovery may be imminent.
Currently, most of the XRP holders who have bought in the last 30 days are 6% underwater. Historical data suggests that they will probably stop selling in this area to prevent further losses. If that happens, the price could bounce back 13% towards $0.52 before Ripple investors start selling.
And if XRP can break this resistance level, the bulls could push higher towards the $0.60 area before booking profits.
However, the bears could turn the trend in their favour, if XRP price drops below $0.45. However, some investors who want to keep their losses below the 10% range may offer support at this level.
If the $0.45 support level fails, XRP could drop towards the 18% loss range at $0.39. But in this case, some stockholders may cut their losses, inadvertently triggering a rally.
In line with Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate and unbiased reporting, but market conditions are subject to change without notice. Always do your own research and consult with a professional before making any financial decisions.