XRP holds key support as MVRV suggests undervaluation
- XRP trades above $1.42 short-term support after rejection from the $1.50 supply area, amid muted ETF activity.
- The on-chain MVRV Z-Score metric holds at 0.04, indicating undervaluation and a potential bottom for XRP.
- The 50-day EMA holds as near-term support, but key moving averages cap upward price action.
Ripple (XRP) is struggling to hold above $1.42 short-term support at the time of writing on Thursday, down roughly 5% from the monthly peak around $1.51. The remittance token’s recovery appears lock-step, as risk-off sentiment and softening institutional demand weigh.
Why XRP could be undervalued
The XRP on-chain Z-Score metric extended its decline to 0.04 on Wednesday, remaining below the token’s realized value. According to Glassnode, the Market Value Realized Value (MVRV) Z-Score evaluates whether XRP is overvalued or undervalued relative to its “fair value.”
When XRP’s market value, calculated by multiplying the spot price by supply, is lower than the realized value, measured by cumulative capital inflows into the asset, it signals a local market bottom.
On the other hand, a market value above the realized value often signals a local market top. The chart below shows the MVRV Z-Score holding persistently slightly above the XRP fair value since early February, suggesting possible undervaluation and a likely local bottom.
Still, XRP lacks the tailwind to trigger a reversal, despite being undervalued, especially amid faltering demand for spot Exchange-Traded Funds (ETFs). Institutional activity remained muted on Wednesday, with US-listed ETFs not recording any flows. SoSoValue data shows cumulative inflows steady at $1.36 billion, while net assets declined slightly to $1.14 billion, from $1.16 billion the previous day.
Technical analysis: XRP stages fresh recovery bid
XRP trades above $1.42, holding between major Exponential Moving Averages (EMAs), the 50-day EMA at $1.42 and the 100-day EMA at $1.49, leaving the near-term bias broadly neutral. The 200-day EMA, higher up at $1.70, continues to frame the broader bearish structure.
The Relative Strength Index (RSI) around 53 on the daily chart and a slightly positive Moving Average Convergence Divergence (MACD) histogram hint at modest, but not decisive, bullish momentum as price consolidates near the current range.
On the topside, immediate resistance lies at $1.45, followed by the 100-day EMA around $1.49 and the downward resistance trendline near $1.50. Moreover, the 200-day EMA at $1.70 serves as a more distant cap if buyers extend the recovery. On the downside, initial support lies at the 50-day EMA around $1.42, reinforced by the latest Parabolic SAR print at $1.40. A sustained break below these levels would expose the pair to deeper corrective pressure despite the current neutral tone.
(The technical analysis of this story was written with the help of an AI tool.)
Ripple FAQs
Ripple is a payments company that specializes in cross-border remittance. The company does this by leveraging blockchain technology. RippleNet is a network used for payments transfer created by Ripple Labs Inc. and is open to financial institutions worldwide. The company also leverages the XRP token.
XRP is the native token of the decentralized blockchain XRPLedger. The token is used by Ripple Labs to facilitate transactions on the XRPLedger, helping financial institutions transfer value in a borderless manner. XRP therefore facilitates trustless and instant payments on the XRPLedger chain, helping financial firms save on the cost of transacting worldwide.
XRPLedger is based on a distributed ledger technology and the blockchain using XRP to power transactions. The ledger is different from other blockchains as it has a built-in inflammatory protocol that helps fight spam and distributed denial-of-service (DDOS) attacks. The XRPL is maintained by a peer-to-peer network known as the global XRP Ledger community.
XRP uses the interledger standard. This is a blockchain protocol that aids payments across different networks. For instance, XRP’s blockchain can connect the ledgers of two or more banks. This effectively removes intermediaries and the need for centralization in the system. XRP acts as the native token of the XRPLedger blockchain engineered by Jed McCaleb, Arthur Britto and David Schwartz.
Author
John Isige
FXStreet
John Isige is a seasoned cryptocurrency journalist and markets analyst committed to delivering high-quality, actionable insights tailored to traders, investors, and crypto enthusiasts. He enjoys deep dives into emerging Web3 tren
