The #XRP price has been in a downtrend since mid-November 2023. However, the XRP bulls seem to be taking control again if the following happens. An analysis of the 1-day chart of XRP/USD reveals that a potential price breakout is imminent.
As of February 15, 2024, the price indicates an uptick in bullish momentum, with the pair currently trading at $0.55335, marking a 4.1% increase in the last 24 hours. A closer inspection reveals that XRP is challenging two critical resistance levels.
XRP Price Needs To Break These Levels
First, the Fibonacci retracement levels, drawn from the swing high at approximately $0.74854 to the swing low at $0.43085, show that the XRP price is currently facing the 0.618 level at $0.55221, which is a notable level for traders as it often acts as a pivot in market sentiment. XRP’s push through this level could indicate a shift towards a bullish outlook.
Second, the 1-day chart also features a descending channel pattern, which began forming in early-December 2023. The upper boundary of this channel has been tested multiple times, and the current price action is once again approaching this boundary. A definitive breakout above this descending channel could signal a trend reversal.
XRP price on the cusp of a breakout, 1-day
chart | Source: XRPUSD on TradingView.com
For this to happen, the XRP price needs to break
above the $0.55 mark, which coincides with the
0.618 Fibonacci level. Adding to the bullish
narrative, the Exponential Moving Averages
(EMAs) show a potential bullish crossover in
progress. The EMA 20 (red line) at $0.52865 is
trending upwards, suggesting short-term
momentum is gaining.
The EMA 50 (orange line) and EMA 100 (green
line) are positioned at $0.54761 and $0.56331
respectively, with the EMA 200 (blue line) at
$0.55985, serving as a long-term momentum
indicator. A break above this cluster of EMAs,
especially the 200-day EMA aka "bull line" could
add to the bullish arguments.
Notably, volume levels have been moderate, and
the Volume Oscillator does not show any
abnormal spikes, indicating that the current
price increase is not yet backed by significant
trading volume. This could suggest that the
breakout, if it occurs, may need to be confirmed
with higher volume to sustain the move.
The Relative Strength Index (RSI) is at 59.62,
which is below the overbought threshold of 70,
indicating that there is still room for upward
movement before the asset is considered
overbought.
Breakout Confirmation Today?
Overall, traders need to keep a close eye on
whether the XRP price can sustain its
movement above the $0.55 to $0.56 range. If
this is accompanied by an increase in volume, it
could confirm the breakout from the descending
channel and possibly lead to a new uptrend.
Given the current technical setup, today's
trading session is crucial for determining the
short-term direction of XRP. If XRP closes above
the 0.618 Fib, descending channel as well as
200-day EMA, the bulls could finally be back.
