XRP managed to make a healthy rally since mid-September as sentiment shifted in favor of the bulls. Its upside in May 2022 led to a retest of resistance. But, alas, whales are starting to contribute to short-term selling pressure.
XRP whales have had a huge impact on its performance so far. For example, the largest whale holding more than 10 million coins had a net increase from September 15 to 19.
This whale division controls more than 70% of the total supply of XRP. In the last two days, whales in the same category have reduced their balance.
Source: Sandhi
The XRP whale has similarly contributed to the selling pressure over the past two days, holding 100,000 to 1 million coins. However, addresses holding between one and 10 million coins are on a buying spree. Thus, the potential downside is limited.
A strong sentiment shift and favorable network growth aided XRP’s bullish mid-month performance. The aggregate weighted sentiment metric rose from negative to positive around September 16.
Source: Sandhi
A similar network growth pivot may contribute to bullish results. These metrics have not moved in the last 24 hours at press time, despite the results of opposing price action.
After showing higher relative strength, XRP managed to move up as much as 29% from its mid-level.
There was an attempt
That being said, it is important to note here that XRP’s price action has registered a slight pullback over the past 24 hours, confirming significant selling pressure.
This was consistent with the aforementioned whale outflow. The upward shift occurred after XRP retested a long-term support level.
Source: TradingView
Well, XRP’s current selling pressure suggests that it could be headed for a major pullback. However, the prevailing supply was low on September 21, probably because the pressure bought from some of the whales provided more friction for the bears.
Interestingly, the Federal Reserve raised benchmark interest rates by another three-quarters of a percentage point on September 21. After that, XRP fell by 0.50% on September 22.
Bearish results could trigger a deep retracement. Investors should consider that XRP’s price action is heading towards a support and resistance squeeze zone. A potential breakout, thus, could be drawing closer despite the recently failed attempts.
