Important points:
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The number of XRP whale addresses has reached an all-time high of 317,500, indicating accumulation.
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For XRP price to have a chance of regaining $3, it must first break through the $2.59 resistance.
XRP (XRP) has rebounded from Friday’s low of $2.18, rising 13% to an intraday high of $2.48 on Monday.
A strong technical setup and whale activity indicated that the XRP/USD pair is poised for a trend reversal towards $3 in the coming days.
What’s behind the XRP rally?
XRP whales have taken advantage of the recent decline to accumulate more tokens and remain confident in the prospect of further upside.
Santiment’s whale count indicator shows that the number of wallets holding at least 10,000 XRP has reached an all-time high of approximately 317,500.
“XRP price rebounded modestly by +5.3%,” Santiment said in an X post on Saturday.
Related: Ripple aims to buy $1 billion in XRP tokens for new Treasury: Report
The market intelligence firm said the continued increase in the number of medium to large stakeholders is a “good long-term sign”, adding:
“XRP now has over 317.4 thousand wallets holding at least 10,000 coins for the first time in history.”
This coincides with a sharp decline in XRP supply on centralized exchanges over the past 30 days, according to Glassnode data.
The graph below shows that between September 19th and October 19th, the percentage of XRP supply on exchanges decreased from 6.12% to 3.9%.
Declining exchange balances suggest less supply is available for immediate sale, reinforcing XRP’s upside potential.
“The vast majority of XRP on exchanges is already gone,” crypto investor Black Swan Capitalist said in a Sunday post about X, adding:
“With so little liquidity left, any significant demand will force the market to quickly absorb the remaining supply. Conditions are ripe for a major trend reversal.”
As reported by Cointelegraph, Ripple plans to launch a $1 billion digital asset treasury company.
XRP price needs to regain 200-day SMA
XRP price movement has been following a potential V-shaped recovery chart pattern on the daily time frame since mid-September, as shown below.
A V-shaped recovery is a bullish pattern that forms when an asset drops sharply and then rises in price. It is completed when the price rises to the upper resistance of the V formation, also known as the neckline.
XRP appears to be on a similar trajectory, but bulls need to reverse the 200-day simple moving average (SMA) of $2.59 to confirm a recovery.
Another tough barrier lies within the $2.81 and $2.95 supply zones, bounded by the 50-day and 100-day SMAs, respectively.
Above that, the next logical move would be the neckline at $3.40, which completes the V-shaped pattern. This is a 26% increase from the current price.
XRP analyst Egrag Crypto highlighted the key levels to watch, saying, “A close above $2.55 to $2.65 in the 3-day time frame would be a strong bullish signal!”
Meanwhile, the Bollinger Band Width, a technical indicator used by traders to assess momentum and volatility within a range, has reached its narrowest point since June, indicating that significant price movements may be afoot.
The last time the band was this tight, XRP price rebounded 66% from a multi-year high of $2.20 to $3.66.
As reported by Cointelegraph, the 20-day EMA at $2.63 is a key level for bulls to overcome, and a break above it could push XRP price towards $3.40.
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.