Nothing much happened in XRP trading yesterday, apart from a minor dip around midnight, and a small bump around 8:00 a.m (UTC).
The lack of movement suggests investors are still underreacting to this week’s Ripple news about “Lightning” payments and an expansion into China. The Lightning network is particularly important, as Ripple claims it can now facilitate payments across different ledgers.
Not only does this protocol support Ripple’s ambition of becoming a clearinghouse for the crypto market, but it could also validate the “open marketplace for cryptocurrencies” endgame.
Under normal circumstances, this news might have lifted Ripple to higher levels. It did not, however, because timing is a powerful force in financial markets, and the timing was bad.
For the past two weeks, investors have been obsessed with Bitcoin and its offspring, Bitcoin Cash. It sucked up all the air in the room. But as expected, Bitcoin survived the attempted coup d’etat, which led to a massive rally in BTC prices.
Investors let tunnel vision for Bitcoin blind them to positive news elsewhere. That said, we are starting to see the environment rebalance.
Yesterday, XRP prices gained more in terms of Bitcoin than USD. The XRP/BTC rate jumped 3.03% compared to the XRP/USD move of 0.03%.
This disparity might point to a reverse rotation of funds, from BTC back to XRP. If it continues, we could see investors price in the Lightning network and China news, thus validating our bullish Ripple price prediction.