XRP Whales Offloading: What’s Behind the 640 Million Token Sell-off?
In a surprising turn for the XRP market, recent data indicates that whale wallets have significantly offloaded approximately 640 million XRP tokens over the past month, totaling around $1.91 billion in value. This has raised eyebrows among traders and analysts, particularly given the timing of these transactions during a period of price rallies.
The Recent Whale Activity: A Deeper Dive
According to onchain data resource CryptoQuant, this notable sell-off began on July 9 and primarily occurred while XRP prices fluctuated between $2.28 and $3.54. This marks the second instance in the last year where substantial distributions have transpired amid growing price momentum, suggesting deeper market dynamics at play.
Throughout this year, as XRP surged from $1.65 to $3.27, large holders began reducing their exposure, hinting that retail demand was possibly absorbing the sell pressure. While not all outflows directly point to selling activities—some could be mere internal reshuffling—the signs suggest that the market may be facing a structural weakness.
As of now, the whale flow appears to be undergoing a bit of recovery, yet analysts stress that a sustainable upward trend hinges on the willingness of large holders to accumulate significantly more tokens. The Enigma Trader, an analyst affiliated with CryptoQuant, remarked that without the addition of at least 5 million XRP by whale addresses, the outlook remains pessimistic.
Support Levels and Market Risks
The stakes are high for XRP as it attempts to maintain its position above the crucial support level of $2.65. Failure to hold this value could result in a dramatic 30% downturn, potentially pushing prices back to around $2. Underneath this scenario lies a bearish divergence, with rising prices juxtaposed against falling momentum, which is evidenced by declining readings on the relative strength index (RSI) since January.
Historically, such divergences have preceded significant market corrections, possibly mirroring trends observed in April 2021’s peak. Additionally, the prevailing trading volume has notably diminished, further eroding confidence in ongoing price rises.
If the correction continues, XRP may test the 20-week exponential moving average (EMA) near $2.55, closely aligning with the critical support zone at $2.65. Should XRP breach this range, a deeper decline towards the 50-week EMA at $2.06 could become a reality, presenting vital mean-reversion elements after a series of overheated rallies.
While market watchers keep their eyes peeled for these developments, the intricate relationship between retail enthusiasm and whale actions will be critical in shaping XRP’s immediate trajectory. Investors are urged to remain vigilant as the crypto landscape continues to evolve with significant implications for assets like XRP.