HomeCryptoWhat are XRP and other cryptocurrencies for in January? Cryptocurrency Market Analysis, December 29
What are XRP and other cryptocurrencies for in January? Cryptocurrency Market Analysis, December 29
December 30, 2022
There is a lot to be desired from the cryptocurrency market in the new year, but we are unlikely to start 2023 on a positive note
Apart from the non-existent liquidity and volatility in the cryptocurrency market, some analysts are noting an unfortunate recovery trend in the US dollar index which could lead to another collapse of the cryptocurrency market, which is already having a difficult end to the year .
What to expect from XRP and others?
XRP’s price performance in 2022 has been a series of ups and downs: at the beginning of the year, we saw a 60% spike to $0.9, and at the end of the year, the price of the cryptocurrency collapsed at $0.34. However, looking at the market performance in the background, XRP has done relatively well, losing “only” 56% of its value since January 1st.
In the coming year, we don’t expect any explosive performance from usage-dependent assets like Ethereum, Solana or Matic. The cryptocurrency industry will likely remain passive as most inflow providers are not ready to come back yet. This means that XRP and its counterparts will have to stall for a few more months.
Cardano reaches new lows
If you are not used to Cardano’s constant battle for good market positioning, then you have not followed the cryptocurrency market for a long time. Over the course of this year, Cardano has failed to find any way to retrace and rise again due to the poor performance of the market, and the network in particular.
Despite the high development activity, the usage of Cardano as a network for NFTs and DeFi is still too low to create favorable conditions for the growth of the ADA market. After reaching an almost six-month low on the daily chart, ADA could show us a short-term bounce, but it will most likely only happen in the new year.
DXY reversal potential
Macro conditions in the US economy for the cryptocurrency market remain tight: the inflation target has not yet been met by the Fed and the regulator has made it clear that market performance is not their top priority. This means that rate hikes will continue in 2023, along with pressure on risky assets, including cryptocurrencies.
According to the daily chart of the index, DXY shows some reversal patterns. The index value has straightened out, volumes are decreasing, as is volatility, which is the perfect trifecta for a turnaround, technically speaking.
However, we shouldn’t jump to conclusions as at least two of these factors could be a result of the holiday season in US markets and we could see a rapid recovery in the aforementioned metrics after January 3rd.
Unfortunately, there is the possibility of a negative scenario: in the event of a DXY reversal, we would see increased pressure on the cryptocurrency market, which could lead to yet another dip towards new lows.