Ripple locks 1 billion XRP: Here’s how the token reacted
- Buyers are attempting to push XRP above $0.61.
- Liquidation can occur around $0.58 due to high liquidity concentration.
In usual fashion, Ripple [XRP] has locked one billion XRP tokens, according to a revelation by Whale Alert. A look at the transactions showed that the blockchain payment firm locked the tokens in four different batches.
This includes a first 200 million lock in escrow, followed by a 300 million transfer. The project then ended the transaction with a 500 million XRP lock.
— Whale Alert (@whale_alert) December 1, 2023
XRP sentiment changes
Ripple has a habit of locking tokens at the end of every month or the beginning of a new one. The project does this because it does not have a mining reward system like Bitcoin [BTC].
So, to cover the loophole, it put up a plan to lock 55 billion tokens to balance the demand and supply levels of XRP.
Sometimes, the activity leads to a surge or decline in the XRP value. However, AMBCrypto’s assessment of the XRP price action showed that the cryptocurrency only consolidated this time.
At the time of writing, XRP’s value was $0.61— around the same value it was on the 2nd of December.
Despite the sideways XRP movement, the sentiment around the token seems to have changed. On the 30th of November, XRP’s Weighted Sentiment was -0.45. The reading at that time implies that the broader market was bearish on the price.
But at the time of writing, the Weighted Sentiment had climbed into the positive region. If the reading continues to grow, it means market players are convinced that XRP’s price might soon increase.
The token offers risk and reward
Also, Santiment data provided context by considering the Relative Strength Index (RSI). At press time, the RSI reading per 4-hour chart was 62.06. This reading suggests that buyers are trying to get XRP above $0.61.
Should the RSI reading continue to climb, XRP may be able to retest $0.65 in the short term.
AMBCrypto also considered the XRP liquidation heatmap using HyblockCapital’s data. The liquidation heatmap helps traders to identify high-liquidity areas.
A high concentration of liquidity around a particular region means a cryptocurrency price can head in that direction. For XRP, the high liquidation level zone was around $0.62, indicating that the token has a good chance of hitting the price.
Read Ripple’s [XRP] Price Prediction 2023-2024
However, short-positioned traders need to watch out for the $0.58 level where there was also a high level of liquidity. If XRP retraces, a lot of liquidation can happen in the zone.
In the meantime, the Ripple native token may continue consolidating. But if a large buy order comes in, traders should expect the cryptocurrency’s price to jump above $0.62.