XRP Daily Chart
Despite recent losses, XRP maintained above $0.633 which kept its symmetrical triangle intact. A breakout in either direction was a possibility from here on and although the trend prior to the formation of this pattern was bearish, there were signs of a possible trend shift in the market. Either way, the path forward for bulls was quite a climb. The daily 20-SMA (red) and 200-SMA (green) were yet to be flipped to bullish.
Moreover, XRP had to negotiate through a period of slightly lower volatility and receding volumes. Once buyers return, a close above its 50% Fibonacci extension level ($0.71) and 200-SMA would trigger a breakout from the pattern and push XRP towards the 61.8% Fibonacci level ($0.775).
An extended rise might even see XRP surge all the way up to its 50-SMA (yellow) and 78.6% Fibonacci ($0.85) which overall, would represent gains of 25% from the upper trendline of its triangle. However, a bearish outcome cannot be ignored considering the recent bouts of selling pressure. In case of a breakdown, XRP would head to its first defensive line of $0.60, present at the 23.6% Fibonacci level.
Reasoning
According to Awesome Oscillator, bullish momentum was accumulating for an upwards breakout. The Aroon up even crossed above the Aroon down and signaled a shift of market dynamics towards the buyers. However, a bearish trend was still active as per the Directional Movement Index. The -DI maintained above the +DI , although the two lines did converge at press time.
Conclusion
The XRP market could see some sideways movement below its 200-SMA before volatility picks up in the market. While there were no clear signs of a bullish breakout just yet, the buyers seemed to be the ones making progress. A rise towards $0.885 can be expected in a best-case scenario. If sellers dominate over the coming week, XRP would be under the threat of a retracement towards $0.60.
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