3 reasons why XRP price could drop 25%-30% in March
XRP price risks dropping by more than 25% in the coming weeks due to a multi-month bearish setup and fears surrounding excessive XRP supply.
XRP has been consolidating inside a descending triangle pattern since topping out at its second-highest level to date — near $1.98 — in April 2021.
In doing so, the XRP/USD pair has left behind a sequence of lower highs on its upper trendline while finding a solid support level around $0.55, as shown in the chart below.
In the week ending March 13, XRP's price again tested the triangle's upper trendline as resistance, raising alarms that the coin could undergo another pullback move to the pattern's support trendline near $0.55, amounting to a drop between 25% and 30%.
The downside outlook also takes cues from other bearish catalysts that has emerged around the triangle resistance.
For instance, XRP formed a bearish hammer on March 12, a single candlestick pattern with a small body and a long upside wick, suggesting lower buying pressure near the coin's week-to-date top of around $0.85.
Additionally, the price turned lower after testing a confluence of resistances defined by its 20-week exponential moving average (20-week EMA; the green wave) and its 50-week EMA (the red wave), as shown in the attached image below.
More downside cues for XRP come after Ripple Labs locked 800 million XRP in escrow as a part of its programmed schedule for withdrawals.
The blockchain payment company moved around 100 million XRP worth nearly $40 million to exchange wallets on March 3. Meanwhile, it kept the other 700 million XRP (worth around $550 million) in an escrow account, raising anticipations that at least 200 million XRP would be flooded into the market to generate funds for Ripple's operational
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