The overall long-term trend on Ripple remains bullish due to this successful breakout. The short-term trend is approaching a key level that will determine the future direction of XRP.
The short-term trend is approaching a key level that will determine the future direction of XRP.
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Ripple has lost momentum after rebounding
According to technical analysis of the weekly chart, the picture for the token of the Ripple project looks optimistic. This is mainly due to the breakout of the downward resistance line that has been present on the chart for 700 days. Breakouts of such long-term patterns often lead to significant price moves.
The news about Ripple is also positive.
The news on Ripple is also positive. For example, Wells Fargo recently predicted that the price of XRP could come to the $100-$500 range in the next 4-7 months. In addition, after Ripple’s resounding victory over the SEC, leading cryptocurrency exchanges have started shedding the token again.
After the high-profile victory of Ripple over the SEC, the leading cryptocurrency exchanges have started shedding the token again.
After a bullish breakout, XRP successfully broke the horizontal resistance zone at $0.54, forming a bullish candle. The token then reached the next resistance level at $0.90, but bounced off it (red icon) during the same week and has been declining ever since.
XRP is currently closer to $0.54 support than $0.90 resistance. A break of the first level would mean a 12% decline, while a break of the second level would mark a 45% rise.
A break of the first level would mean a 12% decline, while a break of the second level would mark a 45% rise.
Source: TradingView
Weekly Relative Strength Index (RSI) shows a neutral bias. This momentum indicator is above the 50 mark, but has been declining since early July, indicating that there is no definite trend.
XRP outlook: whether the bullish pattern will hold
Short-term technical analysis of the six-hour timeframe outlines a bullish pattern for XRP. However, the wave analysis warns that the bullish structure is very close to becoming invalid.
According to the most likely wave scenario, price is now approaching the bottom of the fourth wave of a five-wave bullish structure.
According to the most likely wave scenario, price is now approaching the bottom of the fourth wave of a five-wave bullish structure. Theoretically, after the bottom is reached, a new phase of growth towards the target level of $1.10 is expected to be launched. This is the 1.61 level of the fourth wave outer retracement (white color), and it is 78% away from the current price.
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The reason this scenario is becoming less likely, however, is that the XRP price has fallen below the 0.618 Fibo support level of the 0.618 retracement at $0.63.
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If the decline was corrective in nature, this area would have to act as a base. In addition, the XRP price has fallen below the resistance line of the previous ascending channel.
A recovery above the 0.618 Fibo level will be an important signal that this forecast is correct.
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Source: TradingView
Despite the bullish outlook for Ripple, a drop in XRP below the first wave high at $0.56 (red line) would indicate a bearish bias.
Despite the bullish outlook for Ripple, a drop in XRP below the first wave high at $0.56 (red line) would indicate a bearish trend.
In such a scenario, the price is likely to drop to the channel support line, which is currently at $0.50. This would mean a 20% drop.