Chart by TradingView
Key Support level: $1; $0.96
Key Resistance level: $1.06; 1.2
XRP’s price has broken below the descending triangle and has found support on the $1 trendline after a sharp wick to $0.95.
Today’s market decided to punish the leverage longs, and most altcoins decreased by double digits. XRP is no exception and experienced a 15% drop which quickly recovered just above $1 at the time of this writing.
Considering that XRP broke below the blue triangle, the previous support at $1.06 has turned into resistance, and XRP has to push above that level to get back on the uptrend. The support at $1 is holding, and it is important to see how today’s daily candle closes. If it closes under $1, then XRP may enter a short-term bearish trend.
Trading Volume: The volume on this drop was significant, indicating many leverage longs have been wiped out. When volume increases on a price drop, that shows strength on the bears’ side.
RSI: RSI quickly fell in the oversold territory on the 4-hour timeframe. This indicates that the bulk of the correction has taken place, and any future drops can see less volatility as selling at this point might not be the best trade.
MACD: Sharp reversal and bearish cross-over on the 4-hour timeframe. This price action has amplified the bearish signal on the daily MACD. Unlikely for XRP to return back on the uptrend in the near future.
The short-term bias is bearish. This has to be reassessed once today’s daily candle closes. A firm close below $1 would put XRP on a path towards lower levels.
It’s best to wait for the price action and volatility to fade before taking a position. In the near future, the XRP price might bounce around the $1 level and may provide good entry opportunities around the upper $0.90 level where the local support is found.
