While the crypto market has started the week relatively sluggish, Ripple-linked altcoin XRP is showing bullish signs, according to a tweet from market analysis firm Santiment.
Altcoin XRP Preparing for Rise, According to Analysis Firm Santiment
The firm suggests that XRP is showing a minor bullish sign due to slight investor capitulation.
In simpler terms, some investors are potentially selling their XRP at a loss, causing a drop in price that has historically preceded the rise in value.
Known as “capitulation,” this phenomenon often precedes market bottoms and then sets the stage for a price hike.
The tweet explained this behavior by stating that historically, coins that have been moving at a greater rate of loss than profit are more likely to appreciate.
🤑 As #crypto's largest assets are ranging to start the week, $XRP is showing a slight #bullish sign due to mild trader capitulation. Historically, coins moving at a greater ratio at a loss compared to profit have a higher likelihood of rising in value. https://t.co/6pul5oxUsd pic.twitter.com/pM92pdxEli
— Santiment (@santimentfeed) June 26, 2023
This thinking is based on a classic trading strategy where a big sale can often lead to a price increase.
This increased supply price could be temporarily pulled down when a significant number of traders capitulate or sell their positions in anticipation of a decline. But once the sell-off ends, the decreasing selling pressure can push the price up.
It is possible to see sharp fluctuations in the coming days, especially for Ripple, which is likely to develop in the case with the SEC.
*Not investment advice.
