On October 17, activity on the XRP Ledger saw a pronounced decline, with the payment volume, which tracks the amount of XRP transferred between accounts, dropping sharply to 119.5 million XRP. This represents a stark 72.3% decrease from the previous day, starkly below the 30-day moving average of 629.3 million XRP, raising concerns among market participants about the underlying causes of this fluctuation.
Significant Drop in Transaction Activity
Data from October 18 continued to reflect weak performance, with around 37.5 million XRP recorded by mid-day. Although this figure could increase as the day progresses, the trend shows a 68.6% reduction compared to the previous day. Historically, daily volumes have hovered between 300 million and 1 billion XRP over the past year, with occasional spikes reaching approximately 2.5 billion XRP in November and February. Consequently, daily figures around 100 million XRP remain a rare occurrence.
XRP Ledger’s payment volume plummeted to 119.5 million XRP on October 17, far below the 30-day average of 629.3 million XRP.
A solitary day of weak performance doesn’t necessarily signify a lasting trend. Payment volume can experience erratic fluctuations, particularly quieter readings during weekends. The recent reductions occurring on Friday and Saturday add significance to this context. Despite these fluctuations, with prices concurrently under pressure, the connection between on-chain data and the market outlook is underscored.
Price Outlook Remains Under Pressure
Following a peak of approximately $1.66 in September, XRP has been trading around $1.30. Throughout this period, the asset has fallen below its 50, 100, and 200-day moving averages, which lie between $1.34 and $1.38, presenting obstacles for short-term recovery attempts. The Relative Strength Index (RSI) stands at approximately 40, indicating weak momentum, yet suggesting that the market has not reached oversold conditions.
The broad decline in transaction volume aligns with price activity, indicating a gradual reduction in buying appetite since the rally in August. Both the decrease in on-chain activity and prices staying below significant averages suggest a cautious stance growing stronger among market observers.
Key Levels Under Scrutiny
The $1.25 to $1.27 range emerges as the primary area to monitor in the event of further downward movement. Buyers re-engaged around this band in mid-September and again this week. Should the price close daily below this zone, it could lead to testing the $1.15 level, with August’s $1.00 base area potentially coming into focus next.
For an upward recovery to materialize, the price needs to first breach the $1.34 to $1.38 range. Without this breakthrough, short-term rally attempts may remain limited. If payment volume returns to approximately 500 million XRP in the next few days, the recent drop could be interpreted as a temporary deviation. However, should activity stay subdued and the price persist below current averages, the risk of breaching below $1.25 may increase.
If payment volume fails to return to 500 million XRP in the coming days and the price stays beneath moving averages, testing below $1.25 could become more frequent.
