• XRP price fails to gain price traction, forming head-and-shoulders pattern on the four-hour chart.
  • 50 four-hour simple moving average (SMA) cutting through the topping pattern creating technical pressures for Ripple.
  • Psychologically significant $1.00 playing an active role again in directing XRP price.

XRP price has failed to be a champion during the bounce off the May 19 and May 23 lows, generating only a 50% gain from the low. Over the last four days, the price action has been more reflective of a topping process, putting Ripple at risk of a pullback in the coming days. 

XRP price intentions remain unclear after bounce

XRP price closed on May 23 with a bullish hammer candlestick pattern that was effectively triggered on May 24 when Ripple traded above $0.816. The candlestick formed in the ‘legal uncertainty price range’ associated with the November 2020 high and the December 2020 low, a time in which the SEC case was announced.

Over the last four trading days, XRP price has wrestled with the psychologically important $1.00 and the 50 four-hour SMA. The price action during this time has been passive with waning volume and no demonstrable interest in upside progress, suggesting a mild pullback may be necessary to effectively reset Ripple for a meaningful charge beyond the tactically important price points.

XRP price is projected to define a head-and-shoulders topping pattern on the four-hour chart, generating the needed pullback to reset Ripple for the second leg of the bounce. The measured move target is $0.807 based on the current position of the neckline. It would push XRP price near the upper level of the ‘legal uncertainty price range.’ 

A possibility exists that XRP price will test the upper level of the price range at $0.780 and may even decline to the February 21 high at $0.757, representing a 20% drop from the neckline. Any further weakness raises the odds that Ripple will break under the May 23 low at $0.652, leaving the cross-border remittances token vulnerable to a test of the 78.6% Fibonacci retracement of the rally from the December 29 low at $0.555.

XRP/USD 4-hour chart

XRP/USD 4-hour chart

To reverse the short-term bearish narrative, XRP price needs to rally beyond the head of the head-and-shoulders pattern at $1.07. It would free Ripple to test the 38.2% retracement of the April-May decline at $1.15. Further upside will be complicated by the May 10-13 lows around $1.20-$1.23.

To be sure, as long as the SEC case continues, XRP price will be predominately influenced by the sentiment of the broader cryptocurrency market and the price action of the bellwether cryptocurrencies, Bitcoin and Ethereum.

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. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Cryptos feed Join Telegram

Recommended content


Recommended Content

Editors’ Picks

Why Elon Musk’s tweet failed to move Dogecoin price

Why Elon Musk’s tweet failed to move Dogecoin price

Dogecoin price slipped up as Bitcoin price triggered a sudden crash on May 26. This downswing, while serving as a great opportunity to accumulate DOGE, failed to recover alongside BTC.

More Dogecoin news

Why you should capitalize on this 60% upswing in Solana price

Why you should capitalize on this 60% upswing in Solana price

Solana price shows an interesting divergence on the high time frame chart that could kick-start a much needed swing rally. Therefore, investors need to pay close attention to SOL.

More Solana news

ApeCoin continues to fall as bears aim for $5.00

ApeCoin continues to fall as bears aim for $5.00

ApeCoin exhibits full bearish control. A drop towards the $5.00 target is a high probability occurrence in the near future. ApeCoin price is still following the macro technicals forecasting a $2.00 target. Invalidation of the bearish thesis is a breach above $13.50.

More ApeCoin news

Why Binance Coin price could wipe out all gains made this month

Why Binance Coin price could wipe out all gains made this month

Binance Coin price could be setting up for a plummet back to $217. Binance Coin price has breached the ascending parallel channel to start this Friday's trading session. This week, it was mentioned that the future for BNB price was highly dependent on the directional breakout from the channel.

More Binance Coin news

Bitcoin: The last rebound before capitulation

Bitcoin: The last rebound before capitulation

Bitcoin is showing bullish signs in the lower time frames, which can be taken advantage of by traders in the next couple of days. But looking at BTC from the higher time frames suggests that the bottom is not in yet.

Read full analysis

BTC

ETH

XRP