- XRP price down 7%, knocking price below the lower trend line of a bear flag formation.
- Ripple discovered formidable resistance at the intersection of the Anchored VWAP with the 200-day SMA around $0.740.
- Support at $0.650 is significant, supported by the May 23 low, price highs in February and late 2020.
XRP price did engineer a 45% gain from the June 22 low to the June 29 high, but it does not meet the criteria of an impulsive recovery as volume was unimpressive. Today’s breakdown from a bearish flag pattern reflects the corrective temperament of the rebound. It has raised the odds that Ripple will break below $0.650 and target the 78.6% Fibonacci retracement level of $0.555 and potentially the June 22 low of $0.512.
XRP price lacks mojo, following the same blueprint as other cryptocurrencies
At the June 22 low, XRP price had declined 70% and a remarkable 50% from the June 1 high, liquidating the May 23 low of $0.652, a level fortified by weekly highs in late 2020 and February 2021. Nonetheless, Ripple realized three important technical milestones that provoked a 45% rebound: a test of the 78.6% retracement of the December 2020-April 2021 advance at $0.555, an undercut of the 50-week SMA at $0.540 and registered an oversold reading on the daily RSI for the first time since late December 2020.
The 45% rebound is noteworthy, but it lacks the impulsiveness that characterizes meaningful bottoms and the momentum that would enable XRP price to conquer the immense resistance around $0.740-$0.760. The result has been a bear flag formation triggering today, putting the support level of $0.650 in play very quickly.
The Ripple bear flag formation’s measured move is approximately 36%, suggesting XRP price will defeat the 78.6% retracement level of $0.555 and the June 22 low of $0.512 before bottoming around $0.437.
It is important to note that XRP price has no support of note below the measured move target, amplifying the pressure on committed Ripple investors.
XRP/USD daily chart
The bearish Ripple narrative is persuasive at this point, and only a daily close above $0.760, the neckline of a multi-year inverse head-and-shoulders pattern, would alter the outlook.
XRP price may move into a trading range between $0.555 and $0.760 moving forward, thereby creating ideal trading conditions for swing traders due to the hulking support and resistance levels and the resulting 30-40% profit opportunities that lie between. However, for long-term investors, Ripple is dead money under $0.760
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.