Just Before a 16% Rally... Whales 'Dump' 1.1 Billion XRP

▲ Photo: XRP

XRP is completing a Cup and Handle pattern, a technically strong bullish signal, and is poised for a surge of over 16%. However, a massive sell-off of over 1.1 billion units is positioned at the top, requiring investor caution.

According to crypto media outlet BeInCrypto on April 27 (local time), the XRP price is currently forming a Cup and Handle pattern, a bullish continuation structure, and attempting a breakout. The cup shape was formed by bottoming out around $1.27 between late March and mid-April, and after the high on April 17, it is passing through the handle section, a shallow downward channel. Currently, XRP price is trading above the 20-day moving average of $1.40 and the 50-day moving average of $1.41, indicating short-term trend dominance. The two moving averages are converging narrowly, increasing the possibility of a golden cross.

The primary breakout target indicated by technical indicators is around $1.77, an increase of approximately 16.64% from the current price. However, on-chain data is sending completely different risk signals from the chart. Looking at Glassnode's exchange net position change and cost-basis distribution data, a massive sell wall of approximately 1.16 billion XRP is piled up in the range from $1.44 to $1.53, just above the current price. This suggests that investors who acquired XRP at those price levels in the past are ready to dump their holdings en masse upon reaching their breakeven point.

The most critical resistance level is $1.53. This price point aligns with the 0.618 Fibonacci retracement level and the neckline of the cup pattern. For XRP to decisively break through this zone, it must absorb all the selling pressure from over 1.1 billion units. If the daily closing price settles above $1.53, a full-fledged rally towards $1.77 will be confirmed, but if not, the downtrend in the handle section may lengthen, and the upward momentum is likely to be lost.

The sustainability of the current downside support level at $1.39 is also crucial. If the price falls below $1.39, the reliability of the Cup and Handle pattern will sharply decrease, potentially leading to a further drop to $1.35. In the worst-case scenario, it could revert to the pattern's low of $1.27, risking the invalidation of the bullish scenario itself. Investors should closely monitor the inflow of volume to exchanges and the absorption process of the overhead sell wall, rather than getting fixated on short-term chart formations.

Ultimately, XRP's direction depends on how quickly the market absorbs the large selling volume occurring at the $1.53 resistance level. Even if technical indicators like the golden cross and the Cup and Handle pattern are completed, if the actual on-chain selling pressure cannot be overcome, this rebound may remain a temporary phenomenon. The market is currently at a crossroads between a massive resistance of 1.16 billion XRP and a potential 16% return. Investors should focus on risk management, closely observing price reactions in the resistance zones leading to $1.44 and $1.48.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*