- XRP has massively underperformed BTC for a while.
- XRP hit a key demand zone, but an analyst downplayed a strong bullish reversal for the altcoin.
Ripple [XRP] market participants have been upbeat after revelations that the SEC lawsuit could soon end. The overall market sentiment around XRP was positive, too, in the last week.
Some XRP bulls even set conservative targets at $3 at the end of this cycle.
However, Peter Brandt, a classical price chart analyst, downplayed bulls’ optimism, especially when weighing XRP’s performance against Bitcoin [BTC].
Based on the XRP/BTC chart, Brandt noted,
“My comparison is to BTC, not USD, so here is what I don’t understand. How can XRP bulls be so insistent in that XRP is near ATLs vs BTC, and, in fact, has only closed higher than present levels in 6 of the last 126 months?”
Source: XRP/BTC
Is XRP headed to ‘zero’?
The above XRP/BTC chart tracks XRP performance against BTC. If the value is negative or declining, it means XRP is underperforming BTC.
On the other hand, a positive value, or rising XRP/BTC, translates to XRP outperforming BTC.
Based on the chart, Brandt claimed that XRP is “headed to zero,” meaning XRP was massively underperforming BTC, and XRP holders would rather ditch their holdings and replace them with BTC.
When asked whether the ‘low’ XRP meant that the altcoin had more upside potential than BTC in the rest of the cycle, Brandt quipped,
“Very possible. But the burden of proof is on XRP, not BTC. And, if the play now is with Alts, why not something other than XRP?”
A look at XRP’s weekly charts (XRP/USDT) showed that the altcoin has eased into a key demand zone that has proven steady since mid-2023.
So, a move above the blue 50-EMA (Exponential Moving Average) could embolden bulls to aim at the trendline resistance (white).
Source: XRP/USDT on TradingView
Additionally, one particular on-chain metric showed that bulls could prevail. According to Santiment data, the altcoin recorded a negative Exchange Flow Balance (-6.66 million XRP) at the time of writing.
That meant 6.66 million XRP was withdrawn from exchanges—an accumulation trend.
![Ripple [XRP]](https://ambcrypto.com/wp-content/uploads/2024/05/XRP-Ledger-XRP-10.44.25-13-May-2024.png)
Source: Santiment
The Exchange Flow Balance is the difference between XRP moving to or out of exchange wallets. A positive value means more XRP moved into an exchange than out (signals selling pressure).
The opposite is true, a negative value means more XRP withdrawn from exchanges, an accumulation signal.
Despite the strong accumulation at the key demand zone near $0.05, market sentiment was still slightly negative, as shown by the bearish reading on the Weighted Sentiment metric.
Ergo, one can argue that XRP has underperformed BTC but has dropped to a key demand level. This makes it ripe for a bullish reversal if the SEC lawsuit and long-term market conditions become favorable.
Credit: Source link
