Important points:
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XRP soared 12% to $2.53 on news of Trump’s stimulus plan.
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Recovery may be delayed if long-term holders sell to take profits.
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XRP price resistance between $2.60 and $2.80 will be a major hurdle.
XRP (XRP) price soared 12% on Monday after US President Donald Trump announced that most Americans would receive $2,000 stimulus checks. Currently trading around $2.53, increased profit realization and stiff overhead resistance could limit a continued rally to $3.
XRP profit realization rate increases by 240%
Long-term holders (LTHs), or those who have held XRP for more than 155 days, have increased their profit-taking, calling into question the potential for a sustained rally in XRP this week.
Glassnode noted that previous waves of profit realizations have actually coincided with price increases, as LTH has secured significant profits.
“Unlike previous waves of profit realizations that matched the rally, since late September profit realizations (7D-SMA) have surged 240% from $65 million to $220 million per day,” Glassnode wrote.
Related: What happens when ETH deflation stops and XRP becomes the global liquidity benchmark?
The realization of this profit coincided with a 25% decline in XRP price from $3.09 to $2.30.
“This divergence emphasizes that the distribution is trending toward weakness rather than strength.”
This coincides with sustained selling by whales who intensified their selling activity as XRP price fell below $3.
Santiment’s supply distribution indicator shows that whales holding between 1 million and 10 million XRP tokens released an additional 500,000 tokens in the past 48 hours alone.
These companies currently hold approximately 6.23 billion XRP, down from approximately 7 billion XRP in early September.
However, outflows from whale wallets have eased after a $650 million sale, suggesting a potential bottom for XRP.
This, especially coupled with the heightened risk-on sentiment caused by the likely reopening of the US government this week, could push XRP prices higher in the coming weeks.
XRP price faces stiff resistance at $2.80
As shown in the chart below, the XRP/USD pair is in a downtrend and is oscillating in a descending parallel channel.
The price is once again testing the resistance at $2.60, the area where the 50-day simple moving average (SMA) and 100-day SMA converge.
A breakout of this barrier would increase the chances of a rally towards the upper end of the descending channel at $2.80 (100-day SMA).
Bulls will need to overcome this resistance to aim for $3 and then a seven-year high of $3.66.
Glassnode’s distribution heatmap shows a significant supply cluster centered around $2.80 (100-day SMA), where approximately 1.86 billion XRP has been acquired, which could hinder recovery efforts.
XRP’s “next objective is to break through the $2.70 resistance,” technical analyst ChartNerd said in a post on X, adding:
“Once this resistance is resolved, the path to ATH begins.”
As reported by Cointelegraph, XRP breaking above the 50-day SMA ($2.63) and then rising to the downtrend line of $2.80 would indicate demand at lower levels and facilitate a recovery to the psychological $3 mark.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk and readers should conduct their own research when making decisions.