XRP price rise to the sky: Two driving factors and the outlook ahead

A large amount of up to 210.6 million Ripple tokens (XRP), worth about 738 million USD, has just been circulated between anonymous wallets, instantly sparking a wave of speculation about unusual moves from the "whales."

This development has sparked a lively debate within the investor community: is this a signal that major investors are quietly accumulating assets, or is it merely a carefully orchestrated distribution?

While this massive transaction somewhat reinforces the bullish narrative spreading across the market, its anonymity causes many to be cautious.

Notably, as the price of XRP is currently accumulating just below the key resistance zone, this transfer could be a catalyst for driving buying pressure – or conversely, an early warning of a sudden correction.

Will the rally of XRP continue?

XRP has just recorded a strong breakout to $3.56, approaching a significant resistance area around $3.66. This impressive price increase was triggered after the price broke through the $2.17 level – equivalent to an increase of over 60%.

However, warning signals have begun to appear: the Stochastic RSI indicator is entering the overbought zone, exceeding the threshold of 88, indicating that the upward momentum is showing signs of weakening.

Notably, the price is hesitating and moving sideways just below the resistance level – a sign that the market is waiting for a decisive push from either the buyers or the sellers.

Although the moving average is still maintaining an upward trend, if it cannot decisively break through the barrier of $3.66, the risk of a short-term correction cannot be ruled out.

Source: TradingViewIn this context, the closing candles in the next few sessions will be a key factor – determining whether the bulls will continue to hold control, or if market momentum will begin to weaken.

What is driving the rise of XRP?

The Cumulative Volume Delta indicator (CVD) over the past 90 days shows that buyers are clearly in a dominant position, with the status of "Taker Buy Dominant" – meaning that active buying is completely overshadowing the selling side.

This development reflects the increasingly strong confidence of investors in the price growth prospects of the market, especially in the context where XRP has just recorded an impressive breakthrough.

Buying pressure is further supported by data from the derivatives market, indicating that investors are boldly betting on the scenario of prices continuing to rise.

However, if the buying power relies too much on leverage or the price cannot break through key resistance levels, the current optimistic sentiment could completely reverse, leading to the risk of a widespread sell-off.

Source: CryptoQuantThe trading volume of XRP derivatives has exploded, increasing sharply by 45.49% to 19.41 billion USD. At the same time, the OI index – representing the number of open contracts – also recorded an increase of 4.44%, reaching 11.15 billion USD.

What is particularly noteworthy is the options market: trading volume surged by 137.69%, while the open interest of options contracts also increased by 28.04%.

These figures clearly reflect a strong increase in speculative positions and leveraged trading – factors that can drive prices up in the short term, but at the same time also carry the risk of a deep correction if the market experiences large-scale liquidations.

Signs of Weakness from the Network

The on-chain metrics of XRP are showing serious signs of weakness, leading many investors to question the sustainability of the current price increase. Specifically, the number of transactions has fallen to just 221,000, while the network growth rate – which reflects the level of attraction of new users – has only reached 1,864 new addresses at the time of writing.

This development indicates a significant cooling in network activity, while also shaking confidence in the long-term demand for the asset. Although the price of XRP remains high, the decline in actual usage levels suggests that the upward momentum lacks a solid support foundation.

If this trend does not reverse soon, XRP may face selling pressure as community engagement is gradually weakening.

Source: Santiment## Undervalued or just a hype effect?

The NVT ratio ( of network value to trading volume ) of XRP has sharply decreased by 31.53% in just 24 hours, down to 166.98 – a notable decline.

Typically, a decrease in NVT can be interpreted as a signal that XRP is undervalued, due to a strong increase in trading volume compared to market capitalization. However, it cannot be ruled out that this is a consequence of speculative short-term trading activities.

The recent surge in the number of transactions may be the main reason, but without a corresponding increase in actual users, that will raise many concerns.

Therefore, traders need to carefully assess: does this decline in NVT reflect the intrinsic value of the XRP network, or is it just a temporary "disturbance" due to speculative sentiment – a factor that can significantly impact the long-term trend of this asset.

Source: CryptoQuant## Conclusion: Strong upward momentum but caution is needed

XRP is showing strong upward momentum, driven by overwhelming buying pressure and activity in the derivatives market. However, this trend is facing three major challenges: a strong resistance zone at the $3.66 mark, the RSI indicator falling into overbought territory, and signs of weakness from network activity.

Whether XRP will continue to break out or reverse depends largely on its ability to maintain high trading volumes, confirm a breakout of resistance, and the consensus from the broader market trend. Currently, the price is approaching a key threshold where any scenario could occur.

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