Data shows the Tron Sharpe Ratio has observed a rapid increase into a territory that has proven to be bearish for TRX’s value in the past.

Sharpe Ratio Could Imply Tron Is Overheated Now

As explained by an analyst in a CryptoQuant Quicktake post, the 180-day of the Tron Sharpe Ratio is now flashing a red alert. The “Sharpe Ratio” here refers to an indicator that compares the returns of a given asset with its risk.

Its value is calculated as the difference between the asset’s expected return and the risk-free rate of return, divided by the volatility. This metric tells us whether the returns of the commodity are worth the risk involved with it.

Below is the chart shared by the quant that shows the trend in the 180-day version of the Sharpe Ratio for Tron over the last few years:

The value of the metric seems to have been sharply going up in recent days | Source: CryptoQuant

As the above graph shows, the 180-day Tron Sharpe Ratio has recently observed some rapid growth and reached what has historically been the ‘red’ zone.

In the chart, the quant has highlighted the instances of the metric breaching into this region during the last few years. TRX appears to have generally hit some top whenever the indicator’s value has risen this high.

Tron is now inside this same high-risk zone once again, but it’s possible that the coin may not immediately hit a top, as the indicator is still at a lower level than during some of the tops. The analyst cautions, however, saying:

While TRX may continue its upward trend in the short term, holding positions in a high-risk zone like this can be detrimental. The potential for gains becomes limited compared to the increased likelihood of a sharp pullback, making this an unfavorable situation for long-term strategies.

It remains to be seen how the cryptocurrency price will develop from here on out, considering the trend that has emerged in its 180-day Sharpe Ratio.

In some other news, the supply of Tether’s stablecoin, USDT, has recently witnessed considerable Tron network growth, as CryptoQuant community analyst Maartunn pointed out in an X post.

The value of the metric appears to have been sharply going up recently | Source: @JA_Maartun on X

The USDT supply on Tron has gone from $47.75 billion to $65.7 billion over the past year, representing an increase of more than 37%. This rise naturally shows how interest in using the stablecoin has increased on the network.

TRX Price

Tron broke through the $22 level a few days ago, but it appears the asset has since witnessed a cooldown in bullish momentum, as its price is now floating around $20.

Looks like the price of the coin has observed considerable growth over the last few weeks | Source: TRXUSDT on TradingView

Featured image from Dall-E, CryptoQuant.com, chart from TradingView.com

XRP whales have taken action to shuffle over 100 million coins on Friday, setting off waves of speculation among traders and investors globally. As the Ripple Labs vs U.S. EC lawsuit reaches a potential end, these transactions have sparked substantial intrigue over the firm’s native coin’s future movements. Simultaneously, XRP price continues to pump, with the asset even surpassing BNB in terms of market cap.

XRP Whales Move Over 100M Coins, Ripple Case End Looms?

According to data from Whale Alert on November 29, two XRP whales have moved heavy amounts of the token. Per the data, rBJ.. moved 104.39 million coins, worth $167 million, to another unknown wallet, rhD. Subsequently, another whale address, rBE.. moved 35 million coins worth $52.28 million to another address, rsX. Altogether, these transactions ignited a speculative buzz as the company’s lawsuit against the U.S. SEC saw waves turning in favor of the American blockchain payments company.

Notably, the American blockchain payments company’s lawsuit against the SEC saw new turns, primarily in favor of XRP. Former CFTC Chairman Chris Giancarlo told FOX Business that the “new SEC will drop the appeal,” mirroring optimism in light of Donald Trump’s reelection. Pro-XRP Lawyers Bill Morgan, Fred Rispoli and Jeremy Hogan also proclaimed that the appeals will likely get dismissed or withdrawn. Overall, the XRP whale transactions amid these legal maneuvers have gained significant traction among industry participants globally.

On the other hand, the court has granted the motion to amend the order pertaining to judgment and stay in the XRP lawsuit, per the latest California district court filing in the re Ripple Labs Inc litigation. Both parties in the lawsuit collectively agreed that there was no specific reason to delay the judgment in the lawsuit, given class claims were resolved. Meanwhile, the plaintiff has requested the court for an “express finding in an amended judgment” primarily to avoid any further delay in the final judgment.

Ripple’s Coin’s Price Continues To Rally

At the time of reporting, XRP price soared 13% over the past day to reach $1.65. Its intraday low and high were $1.43 and $1.68, respectively. Notably, the token’s 24-hour trading volume witnessed a 50% uptick in value to $9.88 billion. The rising movement, as the lawsuit against the SEC nears its potential end, has ignited significant among traders and investors globally. It’s also noteworthy that the token flipped BNB in terms of market cap, boasting a valuation of $94.39 billion.

Meanwhile, a recent XRP price analysis by CoinGape Media revealed that the coin surged past a five-year resistance level in market dominance. This bullish trend has further ignited sentiments of a $10 target ahead for the coin. Market watchers continue to monitor the token, expecting further gains imminent.

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Coingape Staff

CoinGape comprises an experienced team of native content writers and editors working round the clock to cover news globally and present news as a fact rather than an opinion. CoinGape writers and reporters contributed to this article.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.