XRP presents buying opportunity before breakout to $1
- XRP continues to test a new support zone in the $0.60 value area.
- Bottom likely in for XRP, relief rally, or trend change incoming.
- The Point and Figure chart shows a bullish entry opportunity.
XRP price develops a bottom with a possible long entry setup that could generate a substantial spike of over 59%.
XRP price ready to return to $1, short squeeze on XRP incoming
XRP price is severely oversold across multiple time frames, with regular and hidden bullish divergences appearing as well. Short sellers may become trapped inside the $0.60 to $0.68 value areas if XRP experiences a strong rebound - like the one currently forming on its Point and Figure chart.
XRP price has a hypothetical long entry opportunity on its $0.01/3-box reversal Point and Figure chart. The trade setup is a buy stop order at $0.64, a stop loss at $0.59, and a profit target at $1.00. The trade represents a 7.2:1 reward/risk with an implied profit target of 58% from the entry.
This trade setup for XRP price is a perfect example of splitting capital into several smaller trades, with profit taken at intervals between the entry and the potential profit target. Additionally, a two to three-box trailing stop would help protect any profit generated post entry.
XRP/USD $0.01/3-box Reversal Point and Figure Chart
The hypothetical long entry is invalidated if XRP price falls to $0.56. In that scenario, XRP will likely complete a full swing lower to the 61.8% Fibonacci retracement at $0.50.
Bulls and bears should be conscious of how volatile cryptocurrency markets will be today. It is the first ‘Fed Day’ of 2022. Commentary from the US Federal Reserve Chairman Jerome Powell will likely generate significant whipsawing in cryptocurrencies.
Author
Jonathan Morgan
Independent Analyst
Jonathan has been working as an Independent future, forex, and cryptocurrency trader and analyst for 8 years. He also has been writing for the past 5 years.
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