XRP, Price Unmoved Despite 300% Volume Surge... When Will it Rise?

▲ XRP/ChatGPT generated image

XRP network activity surged by 300%, but its price remains trapped in a box range amidst a downtrend, enduring downward pressure.

According to cryptocurrency media outlet U.Today on May 3 (local time), the XRP network's payment volume recently surged, recording 1.245 billion XRP. This sudden expansion in network usage is analyzed to be due to large-scale fund transfers or institutional liquidity movements. Such a surge in activity indicates a temporary increase in network usage. However, the increased activity has not led to an actual price increase.

XRP's price remains within a compressed structure on the chart. It is trading sideways between a declining resistance line of $1.40 to $1.45 and a flat support line of $1.30. The 50-day and 100-day Exponential Moving Averages (EMAs) are still trending downwards. The price continues to fail to recover key moving average lines. The current situation is merely a controlled correction within a larger downtrend, not an entry into a bull market.

A sharp increase in payment volume can be a precursor to volatility. However, the payment volume figures themselves do not determine the direction of the price. These figures are interpreted as a result of large investors reallocating their holdings between wallets or exchanges. This means the market is simply absorbing the volume rather than using the surge in activity as a price catalyst. The lack of an immediate price reaction suggests an absence of buying pressure.

The sustainability of this activity also remains unclear. This record is likely a temporary phenomenon rather than a trend of increasing network usage. If overwhelming trading volume is not confirmed in the next spot ETF report, these figures risk being merely a one-off anomaly. Technically, XRP needs to reclaim the $1.45 resistance level to climb into the $1.50 to $1.60 range. If the current structure breaks down, there's a high probability of a retreat to the $1.20 area via the $1.30 support level.

The market will soon enter a period of volatility expansion that will determine its direction. The current converging structure is not expected to last long. The actual price structure, rather than on-chain signals, is the key variable determining the final direction. So far, the chart trend is leaning unfavorably for XRP. Investors should prioritize confirming whether the $1.30 support level holds.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*