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XRP is currently trading near $2.28 following a protracted decline, despite the fundamental growth on the network, according to XRPScan. Since the breakdown in late September, a declining channel has defined its price action. At first glance, this seems like a typical bearish continuation pattern. The falling 50-, 100- and 200-day moving averages are still below XRP.
Network activity stays up
That iss the synopsis that makes the muted sentiment clear. On-chain data, however, paints a completely different picture, suggesting that XRP may currently be one of the market's most structurally sound assets. Although prices have been suppressed for months, network activity has not decreased. Money transfers between accounts have been consistently high over the past month, averaging close to one million per day.
Additionally, the volume of transactions is still high, with multiple spikes in November that are not the result of speculative trading but rather of utility increases. The main indicator is the notable spike in payment volume earlier this week; more than two billion XRP were transferred in a single day. Rather than futures liquidations or panic-selling, this had to do with actual network activity.
Broader metrics over the past year demonstrate that the number of total transactions and successful transactions has either stayed the same or even increased despite market volatility. Neither a decrease in usage nor an exodus of activity is observed. During downturns, the blockchain continues to handle between 1.5 and 2 million successful transactions per day outperforming most alternative L1s. Having that initial strength is crucial.
XRP stays strong
It shows that XRP's value is independent of marketing. Prices lag, but fundamentals do not. This disconnect means that once macroeconomic conditions stabilize or liquidity returns, sentiment may shift more quickly than expected. There will eventually be an end to the descending channel.
Instead of increasing pressure sellers are weakening, as evidenced by the RSI being low but not collapsing. If XRP breaks the upper boundary of the channel and then retests the 200-day moving average, momentum could quickly reverse.
Dan Burgin
Vladislav Sopov
U.Today Editorial Team