XRP’s recent crash has raised questions about its future prospects. The cryptocurrency’s value dropped by over 30% from its highest point this year, despite several bullish catalysts, such as the growth of the Ripple network and a rise in XRP transactions.
Rising odds suggest that the Securities and Exchange Commission (SEC) will end its appeal against Ripple Labs this year, which could bring in new investors. Additionally, data by XRPScan shows that the number of XRP transactions has continued to rise this year, with almost 1 million transactions on March 1.
The Wyckoff Theory, developed 90 years ago by Richard Wyckoff, explains how asset prices move over time and the phases they follow. According to this theory, four key phases exist: accumulation, markup, distribution, and markdown.
XRP remained in an accumulation phase for over three years before entering a markup phase in November, triggered by Donald Trump’s presidential election victory. The price then formed a head and shoulders pattern, with its neckline at $2. If XRP moves below this level, it may enter the markdown phase, which could see the coin drop to its 78.6% retracement level at $1.1395.
As the crypto fear and greed index reaches extreme fear levels of 18, investors are becoming increasingly cautious, contributing to the recent decline. Other cryptocurrencies have also crashed during this period, reinforcing the idea that XRP is in a bear market.
Source: https://crypto.news/90-year-old-theory-explains-xrp-crash-what-happens-next