Key takeaways:
XRP drops 19% from eight-year highs and 12% in 24 hours, with $113 million in liquidations.
Analysts see the pullback as healthy, with $10-$15 upside targets still viable.
XRP price is down 12.5% today, dropping in tandem with the broader crypto market, which has slipped 3% in the last 24 hours to $3.79 trillion.
Despite this correction, analysts are terming this a “healthy pullback” with double-digit XRP price targets still in play.
XRP drops 19%, sees $113 million in liquidations
XRP (XRP) price dropped as much as 19% to an intra-day low of $2.95 on Thursday from its multiyear high of $3.66, data from Cointelegraph Markets Pro and TradingView shows.
Cascading liquidations and thinning liquidity fueled XRP’s drop as over-leveraged longs got flushed across the board.
Related: XRP threatens drop to $3: Will bulls step in to buy the dip?
The overall crypto market saw $968 million in total liquidations over the past 24 hours, according to data from CoinGlass.
Ether (ETH) accounted for the biggest liquidations at $195 million, including $168 million in long positions.
XRP leveraged positions saw $113.62 million liquidated, with $106.8 million accounting for long liquidations.
Crypto liquidations occur when leveraged positions are forcibly closed due to price volatility or insufficient margin to meet maintenance requirements, triggering automatic sales to cover losses, often amplifying market swings.
However, with almost $1 billion in liquidations, experts say that it signals a market bottom.
“Although we didn’t reach the $1B of liquidations that historically marked a local bottom within 1-3 days, the volatility over the last few days may make up for that,” said pseudonymous analyst CryptoData in a post on X.
XRP price correction follows overbought conditions
The relative strength index (RSI) shows that XRP was massively overbought on multiple time frames following its run to $3.66.
At the moment, the RSI has dropped to 61 from 71 on the weekly chart. It hovers around the neutral level of 56 on the daily chart after reaching as high as 88 on Friday, and points downward, indicating weakness in bullish momentum.
The $3 level, which is also the 100-period simple moving average (SMA), now holds as support, and if bulls are unable to defend it, XRP could extend the decline to retest the 200-period SMA at $2.60.
These lower levels provide opportunities for traders to buy more at a discount before the uptrend resumes, according to some analysts.
XRP’s “recent formation broke with significant selling volume, but buyers quickly stepped in with aggressive purchases,” said market analyst Egrag Crypto, adding:
“Don't let fear take over now! Stay strong and hold your position.”
Fellow analyst XRPunkie said the ongoing pullback is a “healthy correction” and is a normal part of crypto market movements.
He said it’s a short-term pause before prices head higher, and a target of $10 to $15 is still very much in play.
“Sit back, chill and relax. Let it bottom out, and we should be on our way to much higher prices real soon. $10-$15 still in play.”
Crypto analyst Dom recently said XRP may top out between $7-$10, depending on its market dominance and how much the rest of the market moves.
According to Bitpanda deputy CEO Lukas Enzersdorfer-Konrad, XRP is still on track to regroup and surpass its 2018 all-time high, citing strong liquidity and growing confidence in altcoins.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.