XRP is attempting a strong recovery after last week's decline, with the altcoin rising 8% in the past 24 hours.
Positive changes in the broader market help XRP regain momentum, but the real driving factor is the renewed confidence of major investors. This increase in activity from major investors may give XRP the potential to test multi-week highs again.
XRP whales are supporting the altcoin.
Purchases by major investors increased as XRP approached the psychological level of 2.00 USD earlier this week. Data on the blockchain shows that wallets holding between 100 million to 1 billion XRP accumulated 620 million XRP within a few days. At current prices, this accumulation is worth over 1.36 billion USD.
Strong purchases like this at reduced price levels signal that major investors are planning for a recovery and see this dip as a buying opportunity rather than a trend reversal. This renewed confidence indicates that positive opportunities are expected to outweigh short-term volatility.
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The economic environment for XRP also shows a clear improvement. The net position change metric for HODLers, which tracks the movements of long-term holders, has started to show positive results for the first time since mid-October. The metric has shifted back into positive territory, indicating that long-term holders have stopped selling and begun to accumulate again.
Support from long-term holders is a key factor in maintaining minimum price levels during uncertain market conditions. Their return provides a solid base for XRP and reduces the likelihood of downward movements. It also prepares the asset to recover in the long term if the broader market conditions remain positive.
XRP is trading at 2.20 USD as this article is being written, having increased 8% in the 24 hours after bouncing back beautifully from the low of 2.00 USD. This recovery from the crucial psychological level reinforces bullish sentiment and aligns with accumulation by major holders.
Maintaining the 2.20 USD level as a support base puts XRP in a strong position to target 2.36 USD next. If XRP can break through this resistance, the altcoin may aim for 2.50 USD and record a three-week high. Buying by whales and support from LTH makes this scenario more likely.
However, the failure to maintain investor confidence may also bring about risks in a downward direction. If selling pressure increases, XRP could drop back to the support level of 2.02 USD, which would nullify the planned upward trajectory and erase recent gains.
