XRP price rally stalls near key level that last time triggered a 65% crash

CoinTelegraph

Macro risks and a long-term bearish setup continue to spoil XRP’s bullish prospects.

XRP’s ongoing upside retracement risks exhaustion as its price tests a resistance level with a history of triggering a 65% price crash.

XRP price rebounds 30%

 XRP’s price gained nearly 30%, rising to $0.36 on June 24, four days after rebounding from $0.28, its lowest level since January 2021.

How To Get Free Crypto  

The token’s retracement rally could extend to $0.41 next, according to its “cup-and-handle” pattern shown in the chart below.

XRP/USD four-hour price chart featuring “cup and handle” pattern. Source: TradingView

Interestingly, the indicator’s profit target is the same as XRP’s 50-day exponential moving average (50-day EMA; the red wave).

XRP/USD daily price chart featuring 50-day EMA upside target. Source: TradingView

Major resistance hurdle

The cup-and-handle bullish reversal setup tends to meet its profit target at a 61% success rate, according to veteran analyst Thomas Bulkowski. 

But it appears XRP’s case falls in the 39% failure spectrum because of a conflicting technical signal presented by its 200-4H exponential moving average (EMA).

Coinbase Banner  

XRP’s 200-4H EMA (the blue wave in the chart below) has previously served as a strong distribution signal. Notably, in April 2022, the token attempted to break above the said wave resistance multiple times, only to face rejections on each try; it fell 65% to $0.28 later.

XRP/USD four-hour price chart featuring 200-4H EMA resistance. Source: TradingView

The ongoing cup-and-handle breakout has stalled midway after XRP retested the 200-4H EMA as resistance on June 23. Now, the token awaits further bias confirmation while risking a price decline similar to what transpired after April.

XRP’s overbought relative strength index (RSI), now above 70, also raises the possibility of an interim price correction.

XRP LTF breakdown underway

The downside scenario on XRP’s shorter-timeframe chart comes in line with giant bearish setups on its longer-timeframe chart. 

As Cointelegraph covered earlier, XRP has entered a breakdown stage after exiting its “descending triangle” structure in early May.

As a rule of technical analysis, its triangle breakdown should have it fall by as much as the structure’s maximum height, which puts its downside target near $1.86.

FreeBitcoin Banner  
XRP/USD weekly price chart featuring ‘descending triangle’ setup. Source: TradingView

In other words, another 50% price drop for XRP could happen by the end of July this year.

Macro risks led by the Federal Reserve’s hawkish policy further strengthen XRP’s bearish bias. The XRP/USD pair has typically traded lower in tandem with riskier assets in 2022, with a correlation coefficient with the Nasdaq Composite sitting at 0.90 as of June 24.

XRP/USD weekly correlation with Nasdaq. Source: TradingView

A score of 1 means that the two assets moves in perfect sync.

Related: Almost $100M exits US crypto funds in anticipation of hawkish monetary policy

Conversely, anticipations that Ripple would win the lawsuit filed by the U.S. Securities and Exchange Commission (SEC) for “allegedly” selling unregistered securities could negate the bearish setups. 

That being said, XRP could rebound toward $0.91 by the end of this year if the ongoing retracement continues any further. Interestingly, the token has bounced after testing long-term ascending trendline support, as shown below.

XRP/USD weekly price chart. Source: TradingView

The bounce has also followed XRP’s weekly relative strength index (RSI) decline below 30 — an oversold threshold, which signals a potential buying opportunity. 

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Go to Source
Author: Yashu Gola


Recommended Crypto Services, Products and Strategies:

The first thing any crypto investor needs is is a reliable and secure Crypto Wallet.  Whether you’re looking for an online wallet, hardware wallet, desktop or mobile wallet, Crypto Renegade provides you with all the Best Crypto Wallets in each category.

Best Crypto Wallets Banner

When you’re ready to buy more crypto, or exchange your coins for others, Crypto Renegade’s list of the Best Crypto Exchanges has you covered.  The Crypto Exchanges recommended here offer everything from simplicity and convenience to advanced trading platforms and profit sharing. 

Best Crypto Exchanges Banner

If you want to learn more about the methods and tools that can be used to find Great Crypto Projects, then be sure to check out Crypto Renegade’s strategy for How To Find The Best Cryptocurrency.

Crypto Strategy Banner

For those people that don’t have any money to invest right now, or just want to understand the technology a bit more, you’ll definitely want to check out Crypto Renegade’s Free Crypto Strategy and start collecting Free Coins today!

Free Crypto Banner

What do you think about cryptocurrency? Do you have any questions about it? Be sure to leave a comment below.

This site uses Akismet to reduce spam. Learn how your comment data is processed.