XRP unexpectedly lost 6% in trading on Tuesday, as large investors collectively reduced their positions to lock in profits at high levels. Notably, this move occurred just hours before a significant speech by U.S. Federal Reserve Chairman Jerome Powell at the Jackson Hole conference.
XRP Whales Dump 460 Million Tokens, Awaiting Signals from Powell
XRP extended its decline on Wednesday, losing another 6% as investors appeared cautious ahead of Fed Chairman Jerome Powell's speech on Friday. In just 6 days, this cryptocurrency has evaporated a total of 13%.
Notably, the group of wallets holding between 10 to 100 million XRP has sold a net amount of approximately 460 million tokens in just one week. In contrast, 'small whales' holding between 1 to 10 million XRP have taken the opportunity to accumulate an additional 130 million tokens. This trend reflects a divide in expectations among large investors. History has shown that XRP's price often follows the footsteps of key 'whales'.
Despite this, the majority of investors are still in a 'profit-taking' state. Over 93% of the circulating XRP is currently in profit compared to the buying level since mid-July, with the average return on investment consistently maintained above 90%. In fact, since the strong breakout last November – following President Trump's election victory – the profit margin for XRP investors has never fallen below 80%.
Part of the upward momentum also comes from Ripple officially closing the legal battle that lasted over 4 years with the U.S. Securities and Exchange Commission (SEC), along with positive legal support from the Trump administration.
However, as favorable legal factors have been reflected in the price and investor profits have remained high for too long, the market risks witnessing a strong profit-taking wave if a price shock occurs. At this time, all eyes are on Powell's speech at Jackson Hole, which could become the catalyst determining how the group of 'profitable' investors will act in the upcoming sessions.
XRP Falls Below 50-Day SMA, Heading Towards Support Zone of $2.78
In the past 24 hours, XRP has consecutively breached several important support levels, including the lower edge of the symmetrical triangle pattern, the $2.95 threshold, and the 50-day simple moving average (SMA).
If it cannot quickly regain the 50 SMA, this coin may slide back to the support area near $2.78. In a more negative scenario, the $2.6 mark is seen as the 'last cushion' to limit the downward momentum.
Technical indicators are currently leaning towards a bearish trend. The Relative Strength Index (RSI) has fallen below the neutral zone, indicating that the bears are in control. Meanwhile, the Stochastic Oscillator has dropped into the oversold region, reflecting that selling pressure remains strong, while simultaneously hinting at the possibility of a technical rebound in the short term.
