Crypto markets lived out a full drama over the long weekend, leaving many investors nervous about the long-run Ripple price prediction.
Prices for some coins reached all-time highs on Saturday, driving the overall crypto market cap to $176.0 billion…but then prices walked off a cliff on Monday.
By the end of it, the crypto market cap shed almost $30.0 billion to settle near $146.1 billion. XRP reached a level of around $0.208277, down roughly 3.23% in the past 24 hours.
To be clear, the fall in XRP prices was part of an industry-wide slump.
There was no Earth-shattering piece of Ripple news that warranted a slash in its coin price, nor was there any reason for us to rethink our Ripple price prediction.
The downtrend can be explained in two words: crowd behavior.
Bitcoin had been building steam towards the $5,000 level. This inspired some altcoin investors to abandon their position in pursuit of a historic landmark.
Lots of trend-following money hopped on the bandwagon at the end of last week and through Saturday, pushing its price to a peak $5,103.91.
The thing about peaks is that they leave nowhere left to go. Like the dog that caught the car, Bitcoin investors were left unsure of what to do once the $5,000 level was reached.
Some panicked and sold. Others that were only there because of trend-following sold as well, tucking their measly gains between their legs and running off into the sunset. But they didn’t run back to the altcoins from whence they came.
They cashed out to fiat currency.
This kind of crowd behavior is a staple of all capital markets, but it’s particularly dramatic with cryptocurrencies. Their relative youth and technological newness make investors jumpy, leading to heightened volatility in either direction.
Owing to this sensitivity, Ripple prices are likely to experience a small setback after each rally. But these sell-offs are almost always short-lived and smaller than the upswings, meaning that XRP is still on an upward trajectory.
As a result, we maintain our Ripple price prediction for 2017.