XRP price has dropped 18% from its $2.75 peak earlier this week as Bitcoin makes a move to $104,000, setting an eye on 60% market dominance.
Following a mega rally all the way to $2.75 earlier this week, XRP price XRP $2.09 24h volatility: 2.7% Market cap: $121.69 B Vol. 24h: $4.00 B faces some selling pressure and could face a major drop if Bitcoin market dominance expands. From the peak on December 3, XRP is already down 18% and is currently trading at $2.28 with a market cap of $130.42 billion. Also, the daily trading volume has dropped 50$ to $13.75 billion.
On the other hand, Bitcoin price BTC $82 538 24h volatility: 0.1% Market cap: $1.64 T Vol. 24h: $28.60 B rally to $104K this week has helped the asset extend its market dominance. Currently, BTC commands 55% market dominance in the $3.5 trillion crypto market. However, some market analysts believe that this number could extend further to 60-70%.
Only after that, the capital rotation to altcoins would begin triggering the altseason. This could pose a major challenge to recently performing altcoins like XRP. Pav Hundal, the lead analyst at crypto exchange Swyftx noted:
“The real danger right now for highly leveraged XRP bulls is that Bitcoin dominance increases again. A rotation from XRP to Bitcoin would very likely lead to a bloodbath of liquidations. We’ve seen a lot of quick twitch buying by retail over the last few weeks, and open interest is now close to double the levels we saw in 2021”.
In the last 24 hours, the XRP price has seen a sharp 5.32% pullback with open interest dropping 6% to $3.51 billion. Also, the long liquidations for XRP have surged to $32 million, per the CoinGlass data. Hundal said:
“It’s starting to look like the market could be approaching euphoria territory.”
How Long Will XRP Price Correct before Bouncing Back?
Crypto analysts have outlined two possible corrective wave patterns for XRP, both rooted in key Fibonacci retracement levels. These scenarios could define the next price movement and offer critical support zones for traders to monitor, as per Chris McCrypto.
- Shallow Correction: Analysts predict a potential bottom between $1.90 and $2.10, corresponding to the golden ratio of the Fibonacci retracement (0.5–0.618). Notably, the $1.90 mark aligns with significant support from subwaves 3 and 4 of Wave 1, reinforcing its potential as a key price floor.
- Deeper Correction: A more pronounced dip could see XRP reach $1.63, aligning with the 0.786 Fibonacci retracement level. This deeper correction aligns with a larger A-B-C wave pattern within subwave 2 of Wave 3. The $1.63 level also matches the previous high of subwave 5 from Wave 1, making it a critical support zone.
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Courtesy: Chris McCrypto
On the other hand, the correction for XRP could be less pronounced in the case that Bitcoin stabilizes. As of press time, BTC price is seeing a 4.7% drop falling under $100K levels, all the way to $98,000. At this point, BTC is finding common ground after a drop to $93,000 earlier today.
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