XRP's February 2025: Profit-Taking or New Highs

XRP Price Outlook for February 2025: A Tale of Two Scenarios

XRP, the native cryptocurrency of the Ripple network, has been making waves in the crypto market, driven by favorable regulatory changes and growing institutional support. As we look ahead to February 2025, two distinct scenarios emerge regarding XRP's price trajectory.

Scenario 1: Profit-Taking and Downside Breakout

On-chain data suggests that a downside breakout may be on the horizon for XRP in the coming weeks. The altcoin's Market Value to Realized Value (MVRV) ratios, assessed over multiple moving averages, indicate that XRP is overvalued, which could prompt holders to sell for profit. As of this writing, XRP's seven-day and 30-day MVRV ratios stand at 1.50% and 14.17%, respectively.

Moreover, XRP whales, who hold between 10 million and 100 million tokens, have reduced their holdings by 1% since the altcoin reached its all-time high. Over the past month, this group of large investors has sold 60 million XRP valued above $180 million. If this trend continues, XRP will likely experience a decline in the next few weeks.

In this scenario, a breakdown below the horizontal channel due to a spike in profit-taking activity could push XRP's price away from its all-time high. In this case, its price could drop below $3 and trend toward $2.13.

Scenario 2: Resumed Accumulation and New Highs

However, if profit-taking stalls and XRP holders resume accumulation, this could push the token's price past the resistance formed at $3.27 toward its all-time high of $3.41. If demand is strong enough, it may even break above this price peak to record a new high.

In either scenario, XRP's price action will be closely watched by investors and traders alike. As the crypto market continues to evolve, understanding the underlying fundamentals and on-chain data will be crucial for making informed decisions about XRP's future.