The XRP price saw a 45% green candle on Monday, extending its weekly and monthly gains to 80% and 415% respectively.
With the token now 25% away from a new all-time high, FOMO-longs are ramping up. However, the possibility of a short-term correction cannot be underestimated.
In fact, experts believe XRP could enter another consolidatory phase, resulting in the rotation of capital back to meme coins.
Meme tokens like Department Of Government Efficiency (DOGE), Moo Deng (MOODENG) and Catslap (SLAP) could deliver explosive returns in the coming weeks.
Why The XRP Price Could Dump To $2?
The XRP price could potentially have entered the ‘overbought’ territory.
For instance, its Relative Strength Index (RSI-14) is currently at 94, which typically results in a short-term correction.
Similarly, oscillator indicators like the Stochastic %K (14, 3, 3) and the Williams Percent Range (14) are currently flashing a “sell” signal on the daily time frame.
Prominent analyst Benjamin Cowen also reveals that XRP’s risk value currently stands at 0.84, the sign of an overheated token.
The XRP price is also facing key resistance levels, both in its USDT and BTC charts. For instance, the token price created a wick above the 0.786 Fibonacci level today on Monday, which has been a key resistance for XRP since the 2017/2018 cycle.
However, it is very likely that it will fail to secure a weekly close above it, resulting in a short-term correction.
Using Fibonacci levels, prominent analyst Nebraskangooner reveals that the risk-reward ratio for XRP doesn’t favour swing traders opening new long positions. He has advised them to wait for a successful retest of the $2.50 support or a dip below the $2 mark to buy the dip.
However, XRP remains an attractive investment for the long term. With the momentum building for spot XRP ETF and RLUSD stablecoin approval, experts are placing their long-term price targets somewhere between $7 and $18.
Why A Bearish XRP Is Bullish For The Meme Coins?
XRP could enter another consolidatory phase with a bearish inclination. However, new meme coins are looking set to explode.
For instance, legendary trader Bluntz is bullish on the Department Of Other Efficiency, also known as “the other DOGE”. As the name suggests, it draws its inspiration from the newly created government efficiency commission, led by Elon Musk and Vivek Ramaswamy.
Similarly, Moo Deng is poised for a new all-time high following its Coinbase listing on Monday.
Smart money investors are also stacking microcap meme coins, eyeing anywhere between 10x and 100x returns. For instance, a whale purchased $186k worth of Catslap (SLAP), an in-demand meme coin inspired by the popular “slapping cat” meme.
The most viral memes birth the best meme tokens. It is no surprise that the Catslap price surged by over 5000% immediately after its launch, followed by a pullback.
The SLAP price is up by 33% today and has even surpassed the 10,000-holder mark. And yet, it has a market capitalization of just over $18 million.
With its regular burns and buybacks, the popular slap-to-earn game and its lucrative staking platform, the SLAP price is poised for a bullish continuation.
Smart money investors have already invested in the meme coin and are eyeing up to 100x returns from it.
