XRP has suffered a harsh reversal and erased some of the gains made in the fourth quarter of last year. Ripple ( XRP ) has moved into a strong bear market, dropping by over 30% from its highest level this year. This decline happened even as the Ripple network faced numerous bullish catalysts. The Ripple USD (RLUSD) stablecoin continues to gain market share, with the daily volume rising to over $100 million. Other players in the XRP Ledger network, like Coreum and Sologenic, have also seen more traction. There are rising odds that the Securities and Exchange Commission (SEC) will end its appeal against Ripple Labs this year. It has already dropped charges against companies like Uniswap , Coinbase, and Gemini. Further, the number of XRP transactions has continued to rise this year. Data by XRPScan shows that the number of XRP transactions rose to almost 1 million on March 1, a trend that may continue in the coming months. Additionally, there are signs that the SEC will approve a spot XRP ETF later this year, a move that would grow inflows from investors. JPMorgan analysts estimate that these inflows would be worth over $8 billion in the first year. You might also like: Solana meme coins rebound, but is it a dead cat bounce? Key risks explained Wyckoff Theory explains the XRP price crash XRP price chart | Source: crypto.news The XRP price has moved into a bear market. Why? Data shows that the crypto fear and greed index has moved to the extreme fear zone of 18. This is pushing more investors to stay on the sidelines. It also explains why other cryptocurrencies have crashed. The Wyckoff Theory or Method, which Richard Wyckoff discovered 90 years ago, also explains the recent Ripple sell-off. This theory describes how asset prices move over time and the phases they follow. He identified four key phases: accumulation, markup, distribution, and markdown. XRP remained in an accumulation phase for over three years as it remained in a narrow range. Its upward surge, or the markup phase, was triggered in November after Donald Trump won the U.S. presidential election. He promised to loosen regulations and appoint a crypto-friendly chair at the SEC. This phase is characterized by higher demand than supply. XRP then entered the distribution phase shortly after hitting its highest level this year. This phase is characterized by indecision and pull-and-push among bulls and bears. It has then formed a head and shoulders pattern whose neckline is at $2. Therefore, there is a risk that the coin will move into the markdown phase when it moves below the neckline. If that happens, there is a risk that the Ripple price will drop to the 78.6% retracement level at $1.1395. Read more: Tezos price prediction: Will XTZ price recover from its dip?
