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Can the price of XRP hit $1 after a 25% spike in one week? Keep an eye on this critical level of support

However, repeating a fractal from 2018-to 2019 might jeopardize XRP’s long-term positive potential.

The price of XRP has continued to rise after plummeting by more than 70% during a correction between April 2021 and January 2022.

Why is the XRP/USD 50-week EMA significant?

On February 13, XRP/USD peaked at $0.916, much above its 50-week exponential moving average (50-week EMA; the red wave) of $0.833. The upward movement, while not definitive, opened the door for more bullish momentum, thanks mostly to a historical purchasing attitude around the stated wave.

For example, more than a year after turning the wave as resistance, traders successfully recaptured the 50-week EMA as support in the week ending July 27, 2020. Later, the price of XRP increased by more than 820 percent to $1.98 in April 2021, the highest level in more than three years.

XRP/USD weekly price chart featuring 50-week EMA. Source: TradingView

XRP’s 50-week EMA, on the other hand, functioned as a significant resistance barrier on many times throughout the bearish cycles between 2018 and 2020. This demonstrated the wave’s capacity to endure positive recovery attitudes, such as those seen during the current market bounce.

Can XRP reclaim $1?

XRP must now remain solidly above its 50-week EMA, which might see it recapture $1 in the coming days. The level is around 25% higher than current prices, corresponding with XRP’s two significant resistance objectives. The first is a multi-month downward sloping trendline that has limited the token’s upside bias since April 2021.

Meanwhile, the 0.382 Fibonacci retracement level established between the $2.70 swing high and the $0.10 swing low has a history of restricting XRP’s strong movements by functioning as both support and resistance.

XRP/USD weekly price chart featuring upside target. Source: TradingView

The $1-level, while still a lower high, does not promise to lift XRP out of its corrective bias. Instead, it may provide opportunities for traders to lock in their intermediate profits, potentially exposing XRP to a drop into an approaching support target of $0.71, as seen by the Fibonacci retracement graph.

The case of the bears

If XRP fails to attain a final close over the 50-week EMA resistance, it may look for a return into its 200-week EMA (the blue wave) near $0.54.

This move risks keeping the price inside a range defined by the 50-week EMA as resistance and the 200-week EMA as support, perhaps leading to a further negative breakout. As illustrated in the figure below, the negative view emerges from a fractal from the June 2018-June 2019 session.

Notably, XRP’s rise to a record high of $3.55 in January 2018 corresponded with its weekly relative strength index (RSI), which formed a lower high, indicating a bearish divergence.

XRP/USD weekly price chart. Source: TradingView

Later, the price fell below the 50-week EMA but supported the 200-week EMA. As a result, the RSI fell to about 37, just over its oversold value of 30.

XRP trended sideways inside the moving average range, while the RSI remained above 37. Nonetheless, the price fell below the 200-day EMA support in June 2019, extending its drop to as low as $0.10 in March 2020.

If the fractal repeats itself as it did in 2018-2019, XRP might go below its 200-week EMA support at $0.54 in the next sessions. According to the Fibonacci retracement graph painted from the $0.14 swing low to the $1.52 swing high, such a move might push XRP’s interim downside target to the 0.786 Fib line near $0.43.

XRP/USD weekly price chart featuring downside targets. Source: TradingView

Meanwhile, a break below $0.43 would set the next downward target at $0.22, a level with a history of the significant trading volume.

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