Ripple tests $0.4 as market correction deepens

  • Ripple's impressive rally loses steam on Thursday.
  • Market cap drops by more than $2 billion.

Boosted by the upbeat sentiment surrounding major cryptocurrencies and positive fundamental developments, Boerse Stuttgart's announcement of XRP ETNs and Coinbase's decision to support XRP transactions in the NY region, Ripple gained nearly 40% since the start of the week and touched its highest level since late November of 2018 at $0.4785.

However, with investors finally opting out to book their profits, the XRP/USD pair came under pressure on Thursday and staged a deep correction. As of writing, the pair was trading at $0.4150, erasing nearly 9% on the day. With today's drop, XRP's market capitalization fell to $17.3 billion from $20 billion earlier today, according to the latest available data on coinmarketcap.com.

The 38.2% Fibonacci retracement of the latest rally that started on May 10 is now located near $0.4 and seems to have formed support in that region. With a daily close below that level, the correction could extend toward $0.3865 (Fibonacci 50% retracement of the same rally) and $0.3650 (Fibonacci 61.8%). On the upside, $0.4350 (Fibonacci 23.6%) aligns as the initial resistance ahead of $0.4785 (daily high/2019 high) and $0.5000 (psychological level).

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