Here I have conducted a study into XRP using the BTC Halving dates as a common temporal reference point. I posit a fractal recurrence of the 2017 run up to the XRP all time high from the latest BTC Halving.
Complicating the matter are two anomalies:
However, what is noticeable in the chart around this time is that both the SPARK spike and the SEC crash effectively cancel each other out, and by the conclusion of the 32nd week after the BTC halving, in the week commencing December 28, XRP has hit a bottom and its fortunes had decidedly turned up. This reflects a similar change in sentiment within the same period in 2017 following the previous BTC halving. Giving further credibility to the theory of a fractal recurrence is that 5 weeks following this 32 week pivot low, in both time periods, XRP had reached another peak, that was followed by 3 weeks of correction.
That now brings us to this week, 41 weeks after the latest BTC Halving. If we cast back to 2017 we see that this was the start of a second leg up for XRP, reaching a pivot high in 4 works. We should, therefore, expect to see another substantial peak reached within 4 weeks, followed by a correction and possibly by a period of consolidation and a final surge to a new all time high, 77 weeks following the BTC Halving.
In 2017, the second leg up reached a high point just shy of 2.5 times the depth of the preceding correction. Using this same projection for the current period, we see that if a fractal recurrence of this was to play out, then we should expect the next high at just shy of $2.69, before the subsequent correction down to around $1.10, a 59% drop.
Now, whether it plays out exactly like this is up to the gods and the "animal spirits" of fear and greed. What can be seen, however, is that there is significantly lower volume today than there was in 2017, and the most recent price spike was relatively muted compared to 2017. This seems to be a result of the SEC case, which would imply that there might be some volatile moves on either good news or bad. One might suggest an example scenario for each:
Either event might significantly disrupt the price performance of XRP and break the fractal pattern of 2017, but we will know for sure in 5 weeks.
Complicating the matter are two anomalies:
- December 12 - The Flare Network announced a hard fork of the XRP blockchain with the promise of an airdrop of SPARK tokens for those holding XRP on December 12. This caused an anomalous price surge in XRP as people piled in to XRP to be award SPARK tokens, before commencing to sell-out of XRP.
- December 22 - The SEC (Securities and Exchange Commission) of the USA announced a lawsuit against Ripple and two founders for selling digital securities, represented by the XRP token. This announcement initiated the waterfall of selling that drove XRP down by over 69%, from $0.57 to $0.16, as US crypto Exchanges further added fuel to the liquidation uncertainty by announcing that they would halt XRP trading pending the outcome of the SEC's case.
However, what is noticeable in the chart around this time is that both the SPARK spike and the SEC crash effectively cancel each other out, and by the conclusion of the 32nd week after the BTC halving, in the week commencing December 28, XRP has hit a bottom and its fortunes had decidedly turned up. This reflects a similar change in sentiment within the same period in 2017 following the previous BTC halving. Giving further credibility to the theory of a fractal recurrence is that 5 weeks following this 32 week pivot low, in both time periods, XRP had reached another peak, that was followed by 3 weeks of correction.
That now brings us to this week, 41 weeks after the latest BTC Halving. If we cast back to 2017 we see that this was the start of a second leg up for XRP, reaching a pivot high in 4 works. We should, therefore, expect to see another substantial peak reached within 4 weeks, followed by a correction and possibly by a period of consolidation and a final surge to a new all time high, 77 weeks following the BTC Halving.
In 2017, the second leg up reached a high point just shy of 2.5 times the depth of the preceding correction. Using this same projection for the current period, we see that if a fractal recurrence of this was to play out, then we should expect the next high at just shy of $2.69, before the subsequent correction down to around $1.10, a 59% drop.
Now, whether it plays out exactly like this is up to the gods and the "animal spirits" of fear and greed. What can be seen, however, is that there is significantly lower volume today than there was in 2017, and the most recent price spike was relatively muted compared to 2017. This seems to be a result of the SEC case, which would imply that there might be some volatile moves on either good news or bad. One might suggest an example scenario for each:
- Good News - A settlement is reached - the announcement of a settlement in the case and US exchanges announce the recommencement of XRP trading. This could see a significant surge in price, possibly a violent rally on the rush to buy the good news.
- Bad News - A protracted trial ensues - the interest in XRP might significantly decline as the speculation on a positive outcome is wound back and holders of XRP seek higher performing assets for the duration of the bull market, leading to further sell offs.
Either event might significantly disrupt the price performance of XRP and break the fractal pattern of 2017, but we will know for sure in 5 weeks.
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Let me know what you think in the comments.