As of this Friday (October 6th), the XRP price USD was at $0.52, having risen 10.6% from $0.47 7 days prior. The rise was much greater than that of Bitcoin (+3%) and Ethereum (-2%) over the same timeframe. According to CoinMarketCap data, XRP reached a high of $0.54 last week (October 3rd) and a low of $0.45 (October 1st), while price volatility (standard deviation) rose to 8.3%, up from 6.1% in the previous week. Market trade volume also rose. The daily trading volume averaged 1.2 billion US dollars last week but rose to 1.8 billion US dollars, or by 50%, reflecting improved capital activity.
Regulatory development is closely related to price movements. On Oct 2, while partially dismissed by the court in their main documents on the Ripple suit of the US SEC, XRP price USD gained 2 hours, growing from $0.48 to $0.53, 8.3% up. On-chain metrics show that during the same period, “whale addresses” with over 10 million XRP increased from 187 to 201, and the holding ratio rose to 38.2% of the circulating supply, which is evidence that big investors are buying at low prices.
Technical metrics show that the bullish sign is strengthening. The daily RSI of XRP rose from 45 last week to 58, breaking through the neutral zone. The MACD bar chart formed a “golden cross” on Oct 4th for the first time since mid-August, which indicated short-term trend change. In the derivatives market, the open interest volume of XRP futures increased 23% to 470 million US dollars, and the ratio of long positions rose from 51% to 63%, which reflects the strong demand for leveraged long positions.
On horizontal comparison, XRP performs better than the majority of major cryptocurrencies. xrp price usd in the last 7 days grew more than Cardano (+5%) and Solana (+7%), but lagged behind Polygon (+15%). Among top 20 market-capitalization tokens, XRP holds the 6th spot when it comes to volatility, and a risk-return ratio (Sharpe ratio) of 1.2, higher than the 0.8 industry benchmark.
Market sentiment is highly determined by events. On 5th October when Ripple publicly disclosed its partnership with the French payments system Lemonway, the mentions on social media picked up pace. The “XRP” keyword was tweeted 40% higher than the average for the previous week to a total of 120,000 tweets for a single day, and positive sentiment percent changed from 55% to 68%. Additionally, rumor that Coinbase was re-listing XRP pushed the price to over $0.53 at one point. Though the official has not confirmed the same as of yet, implied volatility of derivatives has risen to 85% (compared to 62% in the same period last week).
But there are risk factors still. The ratio of the market capitalization in circulation of XRP ($27.8 billion) to the daily amount transferred on-chain ($2.3 billion) has dropped to 12:1, far from the 20:1 healthy ratio, indicating that too much of the ratio is made up of short-term speculative trades. The net inflow to the exchange increased 37% this week, and some investors may take profits at the resistance level of $0.54. If the price of XRP USD cannot stay at its support at $0.50, it could fall back to $0.48 (the 38.2% Fibonacci retracement level).
In conclusion, the short-term strength of XRP is helped by the mitigation of regulatory risks and development of the project ecosystem, but care must be taken against the pressure of pullback under high volatility. If the major resistance level of $0.55 is breached, the next target level is $0.60 (the June 2023 high). If it goes below $0.48, it could test the support level of $0.45.