A crowd sentiment-based bullish indicator has resurfaced, with past price consequences sparking speculation of an XRP rally.
Market intelligence platform Santiment brought this to the attention of XRP holders in a December 4 tweet, suggesting a similar price action would follow. The indicator in question measures crowd sentiment and its price implication for an asset.
XRP FUD Reaches Highest Level Since October
Specifically, Santiment noted that XRP has declined 31% in the past two months, a move that is not far off from the broader market trend. The coin reached a high of $3.10 in early October but has since corrected considerably to its current price near $2.
Notably, this pullback has sparked fear, doubt, and uncertainty (FUD) among crypto enthusiasts. The level of negative social comments about XRP has surpassed even that of Bitcoin, reaching levels last seen in October.
An accompanying chart shows that XRP social sentiment has entered the “Fear Zone,” as retail traders react skeptically to the downward trend. However, history shows this could be a good buying signal for the fourth-largest cryptocurrency by market cap.
Santiment Says Buy the Fear
Meanwhile, Santiment has continued to push the narrative that the best time to buy XRP is when there is blood in the street. The firm again highlighted this period of heightened XRP FUD as the best time to gain exposure to the cryptocurrency.
Interestingly, history also backs this perspective. The chart shows that XRP has usually bounced from the Fear Zone to higher prices. A similar occurrence also occurred in times of social sentiment euphoria. XRP has historically retreated around the “Greed Zone,” when retailers are expecting XRP to go to the moon.
Santiment further noted that the last time bearish comments were far larger than bullish takes on XRP was in November 21. On the day, the coin dropped to $1.82, and crowd sentiment turned sour. However, XRP bounced on this heightened FUD, appreciating 22% in three days to a high of $2.28 on November 24.
As such, Santiment is encouraging exposure at the current XRP price level. The current negative comments are even larger than those seen in November, further bolstering the firm’s confidence in a rally.
“As of now, an opportunity appears to be emerging just like 2 weeks ago,” Santiment concluded.
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