By Franklin Smith
Ripple’s price launched a bearish attitude that might push the remittance token back to value areas never seen since December 2020 and amid the 2020 COVID crash. Thus, enthusiasts should act with care when interacting with XRP.
Ripple Price Couldn’t Reap Benefits
XRP price movements since March 29 formed four unique higher lows and lower highs, showing a symmetrical triangle formation (pennant) when connected with trend lines. Generally, this pattern converges inside two trend lines, ensuring a price squeeze. After some time, the coiling up sprouts into a volatile action.
Unlike different patterns that have biases, a pennant might break either way. This technical setup predicts a 69% price move, obtained from adding the first high and low distance to the breakout level.
Though Ripple price resorted to bullish moves after the past three lower trend-line retests, the recent tag triggered a bearish action. XRP followed the May 5 broad market crash, breaching the $0.575 pennant’s bottom trend line.
Adding the predicted extent to this breakout level reveals $0.176 as a target. Nevertheless, XRP kept its momentum, avoiding a flash crash like most alts. Therefore, a swift recovery beyond the lower trend line.
On the other side, a failure might crash the alt to $0.330. breaching this barrier will see XRP plunging towards the $0.176 predicted target.
The 365-day MVRV model supports the potential downward move by XRP. This indicator measures holders’ sentiment by gauging average loss/profit by traders that bought Ripple coins within the previous year.
Negative values show underwater holders, therefore an unlikely sell-off. On the other side, positive values show holders enjoying profits, suggesting increased crashing chances.
According to XRP’s historical data, the 365-day MVRV hovers at -38%, a recognized support floor that has acted as a base for reversals. Nevertheless, another support barrier stands at -50%, which triggered trend shifts in December 2020, March 2020, and December 2018.
Therefore, XRP has dipping chances, interestingly backing the bearish narrative for a technical view. Meanwhile, enthusiasts should consider broad market sentiment and BTC’s action to ensure lucrative moves.
Stay tuned for the latest developments in the crypto world.