What Caused XRP Price To Crash Today?

XRP price has experienced significant volatility recently, with dramatic liquidation imbalances and failed breakout attempts. In just 24 hours, the token encountered massive liquidations, while its price continues to hover around key support and resistance levels. Will it be just another recovery from its recent drop or will XRP price keep surging to a new all-time high?

XRP Liquidation Imbalance

In the past 24 hours, XRP has witnessed a substantial discrepancy in liquidation volumes. Data reveals that more than $780,000 worth of XRP derivatives were liquidated, with 97.43% coming from long positions. These long positions, essentially bets on the token’s price increase, crumbled due to XRP’s failure to break critical resistance levels.

The optimism surrounding the XRP price and its potential breakout was triggered by a brief 1.5% price increase, reaching $0.54. However, instead of continuing upward, the token faced a sharp rejection, dropping about 1.6% within 30 minutes. Additional selling pressure pushed XRP further down by almost 1.83%, leading to a total decline of 3.37% for the token to hover near $0.50, a critical support level established in June 2022, before surging back up to $0.535 in a quick adjustment.

XRP Key Levels to Watch

XRP recently faced brutal rejection at the $0.55 level, a significant resistance zone that it struggled to break. This rejection brought XRP closer to the bottom of an ascending trendline, hinting at further downside pressure. Trading volumes remain low, suggesting a lack of buyer interest, which makes it difficult for the token to regain strength above this resistance level in the near term.

There are three critical price levels that traders need to monitor closely:

• $0.53 Support: XRP is currently trading near this level, serving as its first line of defense. If this support fails, the token may drop further.
• $0.50 Support: This level is a crucial zone, corresponding to a dynamic price support line that has proven to hold in the past. A breakdown here could lead to more downside pressure.
• $0.48 Ascending Trendline: A pivotal point in XRP’s market structure. If the token bounces off this level, it may signal that the bullish trend is still intact. However, a breakdown would indicate a potential reversal.

As XRP continues to test these levels, volume remains the deciding factor. Without a major surge in trading activity, it is unlikely the token will see a substantial bullish move. Before another breakout attempt at the $0.55 resistance, XRP may need time to consolidate and regain momentum.

XRP’s recent price action highlights the significance of market sentiment and key price levels. The $0.55 resistance has proven to be a major hurdle, while support levels like $0.50 and $0.48 will determine the token’s future direction. For traders, closely watching these levels and the trading volume is crucial. The market is showing signs of consolidation, but any breakout will require increased buying activity to push XRP past its resistance.