Before we dive into the current XRP status and analysis, let’s start with a wider time-frame review (looking at the following daily XRP-USD chart):
XRP had two significant rallies in its short history: The first XRP rally began in March 2017 and lasted for two months. That move had granted XRP’s investors more than 5000%, an unbelievable yield. Every $1000 that was invested would have turned into $50,000. XRP’s price went from $0.006 up to $0.37.
From that point until December 2017, XRP consolidated in what seems like a near perfectly triangle formation. It took around seven months for the triangle to develop: from the formation’s inception until the apex.
The breakout of the triangle had triggered the second XRP rally, from $0.27 to the all-time high at $3.3. 1100% yield.
Since the peak reached on January 2018, XRP lost 92% of its value in a five wave’s decline that took over 11 months.
What is interesting is the fact that XRP corrected precisely to the $0.27 price level, which was the trigger price of the last triangle formation that initiated XRP’s recent rally. Well, this is not a coincidence. Those are the technical rules of markets, or how “market makers” play the game.
XRP had touched the $0.27 price level three times since August 2018, in what seems to be a solid floor.
It is fascinating to notice that even after a 92% loss, XRP is still trading above the first rally’s price level and the 5000% move.
So what’s next for Ripple XRP?
- XRP is currently trading 55% above the mentioned support level, and from a closer look (4-hour chart) we can see that for the third time, the $0.27 support level held.
- Another thing worth mentioning is that XRP chart didn’t create a higher high, yet, since the third time it touched the $0.27 support level.
- In the last 12 hours, XRP broke above the $0.37- $0.395 price level, which is the resistance level that was created by the top of the first-mentioned XRP rally on the 18th of May 2017. The next target for XRP could be found around the $0.45-$0.47 resistance level.
- However, we can assume that it wouldn’t be easy for XRP to break-up the $0.47 resistance level on the first try. As of now, XRP is facing the resistance of the 200 EMA on the daily chart.
- XRP could consolidate sideways in order to gain momentum for a second breakout attempt, or it could retest the $0.395 resistance-turned support
In a more bearish scenario, lower support lies on the mid-channel support level at $0.3139. If XRP breaks below that level,, then XRP will probably try to test the $0.27 support level one more time, but it is too early to determine that.
- Looking at the 4-hour chart: After a nice bullish move, XRP lies in the mid-channel between the $0.45-$0.47 resistance, and the $0.395-$0.37 support level. A breakout to any side will determine the short-term of XRP.
- The 4-hour RSI is around the overbought zone with negative diversions signal starting to develop (higher highs on price while lower highs on RSI).
XRP/USD BitStamp 4-Hour chart
XRP/USD BitStamp 1-Day chart
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Source: Crypto Potato