All too often,markets are driven more by investor emotions than they are by fundamentals. This is quite visible in the price action of XRP (XRP) in the last 2 weeks or so. XRP’s initial pump that saw it hit a high of $0.70 was driven by speculation that XRapid would be going live within a month or so. This created lots of excitement in the market, as investors have always expected that XRapid going live would be the trigger for an XRP moonshot. This excitement was given momentum by SWELL 2018, which happened on the 1st of October. It was widely expected that that this could be the event when ripple would announce the going live of XRapid. And true to these expectations, XRapid went live at this time, but to many people’s shock, nothing happened to the price.
Classic case of buy the rumor sell the news
The price action of XRP all the way to XRapid going live was driven mainly by the rumor that XRapid would be going live. It is this expectation that was driving up the price, as investors tried not to miss out on this event. Anyone who bought during this period made a killing, adding close to 60% to their investments. As such, once the news finally came, it was time to sell, taking profits. This explains the lack of upside momentum after the announcement that XRapid was live. The news had already been factored in, in the build up to the launch. The lack of momentum was compounded by the fact that the companies that went live with XRapid were already testing it, which took away much of the expected excitement, as can be seen by investor sentiment online.
Going through online forums at the moment, it is clear that most people now expect the price of XRP (XRP) to retrace significantly, since there is nothing else to push up it up. The big news has already come, and it has not done much to the price. But for a savvy investor, this could actually be a good time to buy into XRP.
Be greedy when everyone else is fearful
Since the price of XRP (XRP) has not made any gains after XRapid went live, most short-term traders will be selling out of the fear that it could go down, and it is indeed dropping. So why is this a good time to buy? Well, that’s because panic selling of an asset with strong fundamentals usually gives a good entry point for long-term investors. In the case of XRP, its an opportunity to accumulate on asset with some of the strongest fundamentals in the crypto market. That’s becase now that XRapid is live, more institutions will start adopting it. There is a real incentive for financial institutionst to start using it at scale. That’s because when once banks start using XRapid, they stand to save upto 60% of their cross-border payments transactions costs. That’s a huge reduction in costs, and it is only a matter of time before it peaks up in adoption.
Therefore, for someone looking to hold XRP for the long-haul, this is actually the time to buy. Once banks start using it, the price will explode, and reward those who can see the big picture.