Ripple’s native token XRP experienced a price increase of over 7% in the last 24 hours. However, some market commentators suggest this is a typical “dead cat bounce,” often seen during broader market declines, as investors open positions against a short-term XRP rally. On-chain data reveals a consistent decline in both demand for XRP and the habit of investors selling for profit.
Ripple’s Short-Term Rally Provides No Relief
Generally referred to as a dead cat bounce, this price movement signifies a temporary recovery in an asset’s price following a significant decline. On Monday, XRP’s price decline brought it to a 30-day low of $0.43.
Following this drop, the market saw a recovery, with XRP experiencing a 12% price increase in the last 24 hours, which some investors consider a dead cat bounce. On the other hand, both on-chain data and daily price charts indicate that the altcoin may continue its downward trend.
The negative price-daily active addresses (DAA) divergence for XRP also caught attention. This metric compares the price movements of the asset with changes in the number of daily active addresses. Investors track this to understand whether the network activity aligns with the observed price movements.
As of this writing, the calculation for XRP’s price DAA deviation indicated -51.65%. A negative price DAA deviation during a price increase suggests that user activity or network participation is not keeping pace with the price rise. This deviation always indicates a weak and unsustainable rally.
How Much is XRP Coin?
XRP could lose today’s gains and continue its downtrend if selling pressure increases. Consequently, the price could drop to $0.46.
If buying activity continues and indicators turn positive, XRP’s price could rise to $0.52. At the time of writing, XRP’s price was reflected in the charts at $0.5146.
