XRP Locks In a Historically-Favorable Bullish Sign

XRP’s 365-day Market Value to Realized Value (MVRV) is standing at the lowest point as recent buyers are deeply underwater on average. Scoring a 0.92, this low XRP MVRV score is only matched by Dogecoin’s (DOGE) near 0.74, Santiment Intelligence data says.

This potentially reduces the incentive to sell for profits, creating a low-risk demand zone around the current support levels. In theory, that’s more favorable buying conditions. An ultra-low MVRV reading can identify areas where selling pressure is getting closer to exhaustion.

Conversely, the new buyer takes in a higher risk when the MVRV reading is elevated. In the comparison, BTC, ETH, and LINK show more neutral MVRV readings around 0.97-1.04, placing average holders near break-even with limited evidence of either extreme greed or capitulation.

This does not mean XRP’s price must go up soon. It simply means the crowd positioning looks more attractive (less overextended) than other major-caps whose recent buyers are already in profit. For this theory to hold merit, whales must step in at the local bottom along with retail.

XRP’s current price chart depicts a mid-tier Bollinger Band (BOLL) at $1.3822, where bulls can seek confirmation for a run towards $1.5255, aligning with the Red-Label Bollinger Band. In case of a backdrop, XRP’s lower-tier band is situated at $1.2418, also a highly-leveraged area.

Diving into the Derivatives markets data, the 26% upswing in trading volume tells only the half of the story. Most of the recent liquidated positions are still long, while XRP bulls are outnumbered by the short-sellers with a 0.8345 long versus short ratio.

On the bright side, the OI-weighted funding rate is back in green territory. That means XRP’s short-sellers are still paying for the leverage on XRP’s upwards price positions despite less cumulative liquidations.

After the recent cascade of long liquidations, the Open Interest (OI) dipped slightly. Nearly topping $3 billion, this figure also matches with the trading volume on both Futures and Spot markets, signaling solid demand.

Whether that can translate into XRP’s near-term price appreciation remains to be seen as the broader market hinges on fragile thresholds. Ethereum (ETH) was hovering right around $2,400 while Bitcoin (BTC) dwelled below $82K.

The yearly MVRV scores offer a glimpse in market dynamics that are often misread as signs of market weakness.

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