XRP/USD outlook: Sharp pullback faces strong headwinds at key $3.00 support zone
XRP/USD
XRP extends pullback from new high ($3.66) on Thursday after it dropped over 10% on Wednesday, in the biggest daily loss since March 3.
Repeated failure at $3.66 zone with strong upside rejections and double daily Doji candles, as well as overbought conditions on daily chart (Stochastic bearish divergence) generated reversal signal that prompted strong profit-taking.
Fresh extension lower on Thursday morning cracked key supports at $3.00/$290 zone (psychological / Fibo 38.2% of $1.9080/$3.6650 / ascending 20DMA) but faced strong headwinds here that so far formed daily candle with long tail.
This could be initial reversal signal as daily studies remain predominantly bullish, with the most recent formation of 55/200DMA golden cross, supporting the notion.
Close above $3.00 zone would be the minimum requirement for initial positive signal (failure to clearly break key supports and formation of bear trap) which would look for validation on bounce and close above broken Fibo 23.6% ($3.2506).
In such scenario, current pullback will mark a healthy correction of recent strong rally and positioning for fresh push higher, with violation of $3.66 top, to unmask next key barrier at $4.00 (psychological).
Conversely, failure to find firm ground at $3.00 zone would risk deeper pullback and sideline near-term bulls.
Res: 3.2506; 3.2931; 3.4227; 3.3449.
Sup: 3.0000; 2.9525; 2.9040; 2.8592.
Author
Slobodan Drvenica
Windsor Brokers
Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.
