XRP, a cryptocurrency issued by payments company Ripple Labs, is in a period of intense uncertainty and panic among its holders, surpassing the levels of fear experienced by bitcoin (BTC), according to data firm Santiment.
This extreme feeling, which is recorded in a context where the price of XRP has fallen 31% in the last two monthscontrasts with the trajectory of bitcoin.
The Santiment Fear, Uncertainty and Doubt (FUD) Index, indicates that XRP has entered the fear zone. The green circles on the chart mark days when bearish social media comments abnormally outnumber bullish ones, indicating panic among investors.
Historically, these periods of extreme fear have preceded significant upward movements in its value. The last time panic reached this magnitude, on November 21, the price of
Currently, the most recent green circle, dated December 4, highlights the level of «Most Bearish Commentary Since October» (most bearish comments since October). This FUD level implies that the market could be close to forming a bottom before a possible significant rebound..
Meanwhile, the cryptocurrency remains without major variations in its price in the last seven days, with its price established around 2 dollars per unit.
In comparison, bitcoin has shown also huge fluctuations between greed and fear, and these sentiment swings have been a true reflection of the BTC price. The days that there are abnormally higher bullish comments compared to the bearish ones around bitcoin, usually coincide with the greed zone, while days with abnormally higher bearish comments coincide with the fear zone.
The difference lies in the current intensity of the panic. While bitcoin sentiment can vary, XRP sentiment is showing a level of extreme FUD not seen in months. The red circles on the XRP chart have marked the days of extreme greed (greed zone), where bullish comments abnormally outweigh bearish ones, coinciding with price spikes, as observed in late November, where the rally quickly stopped.
This current scenario, which resembles the pattern of recent weeks, raises the possibility of a short-term trend change for XRPif the pattern of reaction to the panic levels previously observed is consolidated. This suggests that the current situation, with levels of extreme fear, could be signaling a potential buying opportunity, as happened two weeks ago when extreme fear triggered a strong price recovery.