The XRP trajectory signals a steep crash of up to 50% in the coming weeks. The bear pattern has already begun, with the altcoin losing 22% in a month.
Here is an analysis of the token’s road ahead and three alternatives that will make a better investment strategy this month.
XRP Bear Flag Signals Potential Breakdown
XRP is one of the world’s largest cryptocurrencies. The altcoin has stood the test of time, thanks to its expansive ecosystem that broadens the boundaries of blockchain innovation. It has large long-term potential.
But in the short term, that is the coming few weeks, XRP is headed toward a plunge. A series of slips can take it up to 50% down the charts.
A stark indicator of the coming downtrend is a bear flag pattern. Usually, a bear flag pattern is identified when a small, upward-sloping rectangle is formed by parallel lines against the prevailing downtrend. Once the price begins to slip down its trend line and takes a plunge comparable to the ongoing downtrend’s height, it is resolved.
XRP/USD price chart. Source: TradingView
With XRP hanging around the lower trend line of its bear flag and the RSI at around 40 this week, analysts are on the lookout. If the altcoin slides below the lower flag’s lower trend line, XRP will be headed for more crashes – potentially touching $0.24 in the second quarter. That translates to around a 50% decline from the current selling price.
Whales Have Lost Patience
Data from Whale Alert reveals that XRP worth hundreds of millions of dollars are moving into exchanges like Bitstamp. The whale action substantiates the possibility of a bear flag breakdown.
XRP supply distribution. Source: TradingView
Notably, Ripple transferred $24.75 million worth of XRP tokens into an unknown wallet on Jan. 30. Although it could be part of routine operations, the timing doesn’t favor the token’s price action.
The reserves of whales holding between 100 million (green) and 1 billion tokens are on a decline, while holdings with entities possessing over 1 billion tokens (gray) are on the rise. The latter category is often made up of crypto exchanges.
More Bearish Indicators
There are more technical indicators that have been emerging against XRP’s hope of a rebound sometime soon.
To begin with, exponential moving averages (EMA) are forming a death cross. The 50-day EMA is on the way to break below its 200-day (EMA). For better context, in Dec 2021, XRP declined 65% after a death cross was formed.
XRP/USD daily price chart. Source: TradingView
Another bearish indicator is the head-and-shoulders (H&S) pattern, which signals a price crash to $0.34, as early as in March or April.
Is XRP a Bad Investment Now?
For long-term investors, XRP will present multiple low entry points in the coming weeks and months. With the price set to go further below, they have an excellent buy-the-dip opportunity.
From a short-term perspective, on the other hand, XRP demands a more strategic approach. The cascade of price declines is expected to be set apart by a series of fleeting surges. Seasoned traders––day traders, in particular––can cash in on these opportunities to make quick gains.
But the investment outlook of XRP is bleaker than high-cap competitors like Bitcoin, Ethereum, and Solana to name a few. The low likelihood of XRP ETFs, ongoing lawsuit with the US Securities and Exchange Commission, etc, hint that XRP could descend the high-cap rankings this year.
3 Alternatives with Higher Upside Potential
1. Avalanche (AVAX)
Avalanche (AVAX) has surged 8.74% over the last ten days. But it has more steam left from the hype around the Vryx scaling solution that was recently unveiled by Ava Labs.
AVAX price action, source: CoinMarketCap
Remarkably, Avalanche developers claim Vryx can propel its network capacity to an impressive 100,000 transactions per second (TPS).
AVAX has the potential to chart a 12-15% surge this month, cashing in on the hype around the Vryx scaling solution. It is one of the best crypto to buy in the high-cap category.
2. Bitcoin Minetrix ($BTCMTX)
Bitcoin Minetrix just surged past its $10M presale milestone. The cloud mining token has been taking advantage of the bear market, bucking the trend.
Established tokens can climb this month anywhere from 30% to 100% in the best-case scenario. Presale tokens like $BTCMTX, on the other hand, can bring 1000% to 2500% returns to early investors if the ecosystem lives up to expectations.
If the rapid presale progress is any sign, investors are optimistic about the project. Traders and analysts have also been featuring the project with positive price projections.
Bitcoin Minetrix is now available for purchase at just $0.0132 in the presale stage. Having crossed the $10M milestone already, there is little time left to buy the token from the official presale page at a low cost.
Another viral presale is Meme Kombat ($MK), which is on its way to the $8M milestone. Being a meme coin, it has higher growth potential, ranging from 3000% to 5000% on its debut launch. The token’s key value proposition is an AI-powered battle arena for iconic meme characters.
2. SUI (Sui)
The next is SUI, which charted an 86.78% surge over the last thirty days. Although the token is going through a mild price correction, it will continue to capitalize on its recent ecosystem developments and partnerships in the coming weeks.
SUI price action, source: CoinMarketCap
Toward the second half of February, the token is expected to make a leap toward $2 (more than 30%), drawing strength from the broader market uptrend.