As the second quarter ended yesterday, XRP’s on-chain activity flashed bearish signals to its owners. The movement of dormant tokens has increased dramatically for tokens. This is a trend that shows one thing. It’s distribution.
When a long coin suddenly becomes active, it suggests that the long-term holder (LTH) is offloading the assets, possibly in anticipation of negative side risk. The current question is whether these holders will decrease even further once Q3 begins.
The dormant XRP token wakes up – have it sold out?
XRP’s dormant circulation (90-day) metrics surged to 387.19 million on Monday, at the highest level in three weeks, according to on-chain data provider Santiment.
This metric tracks the total volume of tokens that were inactive for at least 90 days but suddenly moved within 24 hours. Such a rapid increase indicates that LTHS is driving the tokens.
Historically, a surge in dormant circulation indicates that measured holders will evict their positions to either earn profits or avoid potential losses. Therefore, this trend puts the risk of XRP focusing on a decline.
Furthermore, after a steady decline that began on June 5th, XRP’s vibrancy suddenly reversed the course yesterday, rising to 0.809.
Vitality measures the movement of long tokens by calculating the ratio of coin days to the total accumulated coin days. If it declines, it indicates that LTHS is choosing to move the assets off the exchange and hold them.
Convergently, climbing suggests that more dormant tokens are being moved or sold, signaling profits from XRP LTHS.
XRP faces bearish pressure as sellers control
On the daily charts, XRP’s negative power balance (BOP) supports this bearish outlook. At pressing, this momentum indicator is -0.62.
The BOP indicator measures the strength between buyers and sellers by comparing price movements within a given period. When it becomes negative, sellers dominate the market and hint at potential downtrends.
If this occurs, the XRP price could drop to $2.08. In the other hand, if demand spikes, the price could reach $2.29.
Disclaimer
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