XRP/USDT faces break below $2.00 demand: H&S breakdown could drive price to $1.73
|Failure to defend the $2.00 zone on the daily chart would complete a bearish Head & Shoulders pattern, projecting a 12% slide back toward prior lows near $1.73.
Technical analysis
- Key demand zone: The $2.00 area has acted as critical daily support since March, aligning with the 1.9940 low and a high-volume node on the volume profile. A decisive close below this zone would confirm distribution and open the way lower.
- Head and Shoulders pattern: Left Shoulder near $2.34 (May rally peak); Head at $2.67 (early June high); Right Shoulder around $2.34 (late June retest); Neckline at ~$2.00 (connecting the lows from March and June); Measured Move: Head-to-neckline distance of ~$0.27 projects a drop to $1.73 upon breakdown (a ~12% decline from $2.00).
- Support levels on a breakdown: $1.99 – daily low (neckline); $1.87 – next high-volume node and Fibonacci 38.2% of 2025’s swing; $1.73 – H&S target (measured move); $1.64 – April swing low.
- Resistance on recovery: $2.13 – prior reaction high; $2.34 – shoulders; $2.44 – April consolidation high.
Fundamental context
- Regulatory overhang: Ongoing SEC litigation remains a major catalyst for XRP’s volatility. Any adverse ruling risks further selling pressure, while positive developments could trigger short-covering rallies.
- Crypto market sentiment: Correlation with Bitcoin’s performance (~0.85 on a 30-day basis) means that a broader risk-off move in equities or BTC could exacerbate XRP’s decline.
- Network activity: On-chain metrics (daily active addresses, transaction volume) have cooled since May, suggesting waning demand amid profit-taking at higher prices.
- Macro drivers: With Fed rate-cut expectations pushed into 2025, risk assets remain vulnerable to US Treasury yields holding above 4.2%. A hawkish surprise could spill into crypto markets.
Conclusion and trading plan
- Bearish scenario: A daily close below $2.00 should be met with sell orders targeting $1.87 and $1.73, with stops just above $2.13.
- Bullish reversal: Only a reclaim of $2.34 (shoulder level) on strong volume would invalidate the bearish H&S and open a retest of $2.44–2.67.
- Risk management: Use tight position sizing, given the heightened volatility around regulatory news.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.