After experiencing one of the most remarkable non-meme coin cryptocurrency market rallies of 2024, XRP has entered into a steep crash in the daily chart. Indeed, trading at $2.37, the token has dropped by a significant 7.56% in the last 24 hours.
The fall only becomes starker once the fact that on December 3 – just two days before – XRP stood at $2.82, as it indicates a total collapse of 16% from the recent highs.
Still, the sudden downward shift is, perhaps, not surprising as the recent rally ensured the cryptocurrency’s relative strength index (RSI) crossed above 70, signaling it is significantly overbought.
Such a setup has made the token susceptible to various potential shocks, and two major events have shaken XRP in the last two days.
Why XRP entered a significant correction
Specifically, the first drop from November 3 highs came as South Korea’s president unexpectedly declared martial law and, effectively, attempted to dissolve parliament in a move now investigated as treason.
Still, Wednesday’s downturn was as brief as the heated phase of the political crisis in the East Asian country.
More recently, however, XRP may have been impacted by the rumor that the launch of Ripple’s stablecoin, RLUSD, is imminent. Some high-profile individuals, such as Tron founder Justin Sun, also drove the speculation mill.
However, Ripple’s own statement on X – the one clarifying that the stablecoin has not yet received approval – proved a major blow to the XRP rally.
The token could also soon benefit from external news. Specifically, much like part of XRP’s price explosion was spurred on by the news Securities and Exchange Commission (SEC) Chair Gary Gensler will be resigning on January 20, so could the revelation Donald Trump nominated the cryptocurrency lobbying Paul Atkins as his replacement.
Such a scenario could be particularly plausible once the fact that Bitcoin (BTC) likely caused a significant shift of funds away from altcoins once it broke above the long-awaited $100,000, and the move is likely to be reversed should BTC experience a deep correction or stagnate before advancing further.
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