Social Media Turns Bearish On XRP: Is This A Buy Signal?

Data shows users on social media are the most bearish toward XRP in six months, a potential setup for a contrarian move in the asset. XRP Positive/Negative Sentiment Has Plunged Recently According to data from analytics firm Santiment, social media FUD around XRP has seen a spike recently. The indicator of relevance here is the “Positive/Negative Sentiment,” which tells us about how the bullish and bearish sentiments related to the coin compare on the major social media platforms. The metric works by first going through posts/messages/threads on these platforms to separate those that contain mentions of the asset. It then puts them through a machine-learning model to divide between positive and negative comments. Finally, it takes the ratio between the counts of each category to find the net situation. Related Reading: Bitcoin Spot Volume Rebounds As Price Hits ATH, But Still Far Below Late-2024 Highs Now, here is the chart shared by Santiment that shows the trend in the Positive/Negative Sentiment for XRP over the past month: As displayed in the above graph, the XRP Positive/Negative Sentiment fell to a low of 0.74 a couple of days back, implying bearish comments were notably outpacing bullish ones. The metric followed up with some recovery, but it lasted only briefly as the latest value has again indicated a dominant negative sentiment, with the ratio standing at 0.86. This latest wave of FUD around the asset on social media is the strongest since six months ago, when Donald Trump’s tariffs shook the market. If history is anything to go by, though, the bearish sentiment among retail traders could actually turn out to be a positive for the cryptocurrency. Digital assets have often tended to move in a way that goes contrary to the expectations of the crowd. This means that when the investors are overly bearish, a bottom can become probable. Given that social media users have been fearful toward XRP for two out of the last three days, it’s possible that a contrarian signal could once again be brewing for it. It now remains to be seen how the asset’s trajectory will look in the coming days, and whether social media sentiment will play a part. Related Reading: Bitcoin, Ethereum Lead Record $5.95 Billion Inflows Into Crypto Funds In the scenario that XRP does rebound from here, a technical challenge could be waiting for it, as explained by analyst Ali Martinez in an X post. As is visible in the chart shared by Martinez, XRP has potentially been stuck inside a Parallel Channel on the 4-hour timeframe during the last couple of months. The upper boundary of the channel lies at $3.15, which has proven to be a resistance barrier for the coin in this period. “A breakout here could trigger a rally to $3.60!” says the analyst. XRP Price At the time of writing, XRP is floating around $2.97, up over 4% in the last seven days. Featured image from Dall-E, Santiment.net, charts from TradingView.com