XRP price plunged to an important support level of the Murrey Math Lines on Monday, Sept. 1, as Ripple unlocked more tokens and sentiment in the crypto industry remained neutral.
Summary
- XRP price fell to the strong, pivot, reverse point of Murrey Math Lines.
- Ripple Labs unlocked 1 billion XRP tokens on Monday.
- Technical analysis points to more downside before rebounding.
Ripple (XRP) token dropped to $2.7345, its lowest level since July 11 and 25% below the highest point this year. Its market capitalization moved to $164 billion, down from the year-to-date high of $201 billion.
Ripple Labs unlocks tokens from escrow
The XRP price pulled back as Ripple Labs executed numerous trades. Data compiled by Whale Alert show that Ripple unlocked 1 billion XRP tokens from escrow. Ripple Labs also locked additional tokens into escrow in separate transactions.
While these transactions are large, they are not unusual and reflect how Ripple operates. As part of its tokenomics, Ripple locked 55 billion XRP tokens and began unlocking 1 billion from escrow each month, with any unused portion returned to escrow.
In most cases, Ripple relocks between 600 million and 900 million XRP tokens each cycle, meaning the net supply increase is much smaller over time.
XRP price retreated amid mixed Ripple USD metric. On the positive side, the supply crossed the important milestone of $702 million after rising by 16% in the last 30 days.
On the negative side, the number of RLUSD stablecoin addresses dropped by 35% to 4.6k. Transactions dropped by 42% to 410k, while transaction volume slumped by 74% to $2.6 billion. Most importantly, while Ripple created RLUSD, only $90 of the supply is in the XRP Ledger.
The main catalyst for the XRP price this month will be the October deadline for the SEC to approve some ETFs. As such, the token may rebound as investors anticipate approval, with odds having jumped to over 80%.
XRP price technical analysis
The daily timeframe shows that the Ripple price has slumped from the key year-to-date high of $3.6598 to $2.73 today. This price is notable because it is the strong pivot reverse level of the Murrey Math Lines. Reversals often occur when an asset reaches that level.
However, the Relative Strength Index has dropped to 44, meaning the token is not yet oversold. Therefore, the most likely scenario is that the XRP price keeps falling to the ultimate support at $2.3438 and then rebounds, possibly to $5 as we predicted here.
