More than just a rally, XRP is likely to get stronger
More than just a rally, XRP is likely to get stronger.
The crypto market is seeing a return of optimism as many digital assets, including Bitcoin, have started growing after two long, dismal months. Many altcoins have also started to rally, with XRP seeing one of the fastest and strongest rallies. On the charts, the breakout took place as XRP price easily broke the $0.8 resistance level. This was the previous key support level during the downturn.
Since breaking out of the 50-day moving average, the downtrend (yellow line), on February 4th, XRP has seen a nearly 50% rally.
For now, $0.8 will act as strong support and keep the decline fairly low, while the bulls may touch the $1 area. $0.8 – $1 zone could be the zone of accumulation provided that the broader market has not suddenly deteriorated and XRP momentum continues undisturbed.
XRP price chart | Source: TradingView
Along with favorable technical indicators, the metrics also appear to be pointing to growing optimism. For example, XRP’s Adjusted Price DAA Divergence Indicator has been flashing green signals for a while.
This is a strong signal for a recovery as the index has been sending buy signals despite the general market’s recent decline.
Adjusted price DAA divergence indicator | Source: Santiment
Additionally, XRP’s MVRV ratio is also making a strong recovery. Thanks to XRP’s recent rally, the MVRV ratio has broken out of the 200 moving average, adding more strength to the bullish narrative.
With that, the MVRV-Z-Score has recovered from its lows. Still in negative territory, but an attractive buying opportunity given the past.
MVRV Z Score | Source: Santiment
XRP-ODL corridors are also seeing an increase in volume. In fact, according to Bot Index Liquidity, the liquidity index for the XRP/MXN trading pair on Bitso is on the verge of reaching new ATH levels.
— Liquidity Index Bot (@LiquidityB) February 8, 2022
XRP has seen a surge of interest thanks to recent positive results in the case between the SEC and Ripple Labs, in which investors appear to believe a court ruling in Ripple’s favor could be imminent. Recently, the famous lawyer also offered his thoughts on what the court order to unseal the new documents in the case could mean.
Despite major difficulties, Ripple Labs recently recorded its best performance so far for the past quarter. Overall, the situation looks very optimistic.
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