XRP’s market cap has decreased by 12% to $127 billion, reversing its previous success as it briefly ranked as the third-largest cryptocurrency. Following a significant monthly surge, XRP’s current dip is attributed to various factors, including technical overbought indicators and shifting supply-demand dynamics. As Tether regains its position, concerns over XRP’s future viability have intensified.

In a significant downturn, Ripple Labs’ XRP has experienced a 12% decrease, resulting in a market capitalization drop to $127 billion within a single day of trading. This decline marks a stark contrast from November’s performance, where XRP surged by an extraordinary 344%, temporarily positioning it as the third-largest cryptocurrency behind Bitcoin and Ethereum. As of December 5, 2021, Tether’s USDT has regained its third rank, now holding a market cap of $135 billion, while XRP trades at $2.25, down from a previous high of $2.57. The trading volume has also plummeted by approximately 46%, now at $23.28 billion.

Analysts have cited several reasons for the anticipated price corrections of XRP. First, the price surge has surpassed both short- and long-term moving averages, suggesting a potential retraction towards average levels. Second, technical indicators such as the Relative Strength Index (RSI) and Stochastic Oscillator indicate that XRP is currently overbought, pointing to an impending weakness. Lastly, the supply is failing to keep pace with the demand, indicating that XRP may have reached its markup limit. These factors contribute to the broader concern regarding XRP’s stability and future performance in the cryptocurrency market.

XRP, the cryptocurrency associated with Ripple Labs, has previously garnered significant attention due to its exceptional growth rate. Following a rapid increase in value, XRP not only positioned itself as a frontrunner among digital currencies but also amassed a substantial market capitalization. However, fluctuations in the cryptocurrency market are common, often leading to volatile price movements. This volatility can be attributed to various factors, including market sentiment, trading volumes, and external economic variables.

In summary, XRP has experienced a notable downturn, resulting in a market capitalization decline and a significant price drop. Despite a record-breaking surge in November, recent performance trends suggest a potential crash due to various technical indicators and market conditions. Investors and analysts alike will be watching closely to see if XRP can stabilize or if further corrections are inevitable, particularly in light of the current overbought status of the token.

Original Source: crypto.news

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