Ripple (XRP) has been in a correction for as long as the rest of the market. However, the sentiment towards Ripple (XRP) has remained a lot different than that that towards most cryptocurrencies. This optimism towards Ripple (XRP) stems from the promise of XRP eventually replacing fiat currencies. Given the low cost and high speed of XRP transactions, it is easy to see why most Ripple (XRP) investors strongly believe in this promise. Most of the time, we see that markets do not care about sentiment. It is also true in the case of Ripple (XRP) and as we can see the price declined all the way $3.2 against the wishes of most investors. However, there are still strong signs of an unwavering belief in Ripple (XRP) even during the bear trend.
The first, more important indicator of retail investors’ unwavering belief in Ripple (XRP) can be seen on the charts. The lower half of the above chart for XRP/USD shows a diagram of Elder’s Force Index (EFI) for Ripple (XRP). If we look at this indicator, it shows that the price of Ripple (XRP) surged with incredible strength in late 2017. It also shows that the price of Ripple (XRP) fell with incredible weakness in early 2018. In other words, both the climb and decline were extremely powerful and they happened in very short periods. Even though Ripple (XRP) continued to fall in the subsequent months, the sentiment was never truly bearish.
Now, looking closing at the Elder’s Force Index (EFI), we can see that the bearish momentum ran its course in January 2018. After the month of January, the bearish momentum was lost. While the price did decline along with the rest of the market, the bearish momentum was no longer there. In fact, as the EFI shows, the price did manage to break out at two points but was dragged back into correction by a falling Bitcoin (BTC). The first time that happened was in April and the second time it happened was in September this year. The second and most obvious sign is that Ripple (XRP) was one of the first cryptocurrencies to break the downtrend and actually attempt to begin a new cycle. For the third largest coin by market cap to make such a big independent move is nothing out of the ordinary.
Chart for XRP/BTC (1W)
Sure, most Ripple (XRP) investors would love to see Ripple (XRP) just cut off all ties with Bitcoin (BTC) and break free to do what it wants. However, the fact remains that strategic decisions in the market are made by whales and they do not care about sentiment. Many retail investors in Ripple (XRP) wanted to kick off the XRP rally, but for every XRP loyalist there are whales that do not care about sentiment and would gladly dump on you to choke that rally if it means making a profit. Nevertheless, it was still a solid indicator of retail investors’ special feelings for Ripple (XRP) and confirms our view that Ripple (XRP)’s true bearish momentum lasted less than a month.