Can XRP Reach $4 in May? Analysts Are Monitoring These Important Levels

XRP rose to the sky on May 7, increasing by 2% in the last 24 hours after news of potential trade negotiations between the U.S. and China disrupted investor sentiment. The price of XRP remains above $2 at the time of writing, as some analysts emphasize the important support levels that this asset needs to hold in order to achieve a sustainable recovery to new all-time highs. The Accumulation of Whales Supports the Bullish Outlook of XRP Some indicators suggest that the continuous price increase of XRP may not just be a short-term reaction to positive macroeconomic news. For example, the Supply Distribution data from Santiment shows that the supply held by entities with token balances between 1 million and 10 million has been steadily increasing. These addresses currently hold 9.44% of the total supply of XRP, up 1.2% since January 1.

This indicates that whales did not sell when the price recently dropped to $1.60 but instead accumulated XRP, showing that most are positioning themselves to increase profits. By buying during the downturn, these large entities can reduce selling pressure and create a support level, encouraging smaller retail investors to follow suit. Meanwhile, the open interest for XRP (OI) has modestly increased by 0.32% to $3.65 billion over the past day, signaling a slight rise in trader confidence and liquidity. However, the 17% drop in trading volume to $3.9 billion is a cause for concern, indicating low confidence as traders await a clear trend for XRP prices.

XRP Price Reaches All-Time High of $4? Traders believe that XRP could return to its highest level in seven years of over $3.40 and more, but its potential for continued price increase depends on holding above key support levels. Data from Cointelegraph Markets Pro and TradingView shows that the price of XRP bounced off the 200-day SMA at $2.08 on May 6, rising by up to 4.5% to today's high of $2.17, which is also the 50-day SMA. The 200-day SMA line coincides with the average price based on the voting volume (VWAP) and the monthly rVWAP, as shown in the chart below. "This is the area that we want to continue to protect," trader and analyst Dom said in a post on X on May 6, adding that if it cannot hold above this level, XRP could drop to $1.90. "To see an immediate trend reversal, we need to see the price rise back to the support level of $2.12."

Crypto analyst Egrag stated that the price of XRP "should not and cannot close below the support level of $1.83". Meanwhile, anonymous analyst XForceGlobal believes that "XRP remains in a bullish zone" as long as it holds above the multi-month low of $1.60 reached on April 7. "New all-time highs seem to be about to happen."