Here’s why XRP is sinking towards $0.5 and what to expect next

Ripple has encountered significant selling pressure near the $0.64 resistance level, leading to a sharp decline towards a critical support area around the 200-day moving average at 0, 54 dollars.

The key question now is whether this drop is just a temporary correction or the start of a more sustained bearish phase.

By Shayan

The daily chart

An in-depth examination of Ripple’s daily chart reveals that the recent bullish surge encountered significant resistance at the crucial $0.64 threshold, leading to a period of sideways consolidation. During this phase, a notable bearish divergence appeared between the price and the RSI indicator. It was followed by a substantial drop of 17%, which brought the price down to a critical support zone.

The latter includes the key 200-day moving average at $0.54, which acts as a strong support level. This area is potentially full of demand and sufficient buying interest. If XRP can hold its position above the support and rebound from $0.54, it would suggest that the recent decline is likely a correction and the broader uptrend could resume. In this scenario, buyers would aim to retest the $0.64 resistance level and possibly target higher levels.

On the other hand, if the price breaks below the 200-day MA with strong selling momentum, it would indicate a potential switch to a bearish trend. This could put Ripple at risk of further declines, with the next major support likely around the 100-day MA at $0.51 or even lower. At the time of writing, the price is trying to drop.

Source: TradingView The 4-hour chart

On the 4-hour chart, after facing increased selling pressure near the critical $0.64 level, Ripple price started a significant bearish move, breaking below the lower boundary of the ascending wedge.

This action indicates a strong presence of sellers in the market and suggests the potential for sustained bearish pullbacks.

Currently, the price has reached a crucial support region around $0.54, where buying pressure could emerge in the coming days.

However, if the sellers manage to push the price below this critical threshold, a long pressure event could occur, further accelerating the bearish trend. In this bearish scenario, the next target for sellers would be the price range between the Fibonacci levels of 0.5 ($0.51) and 0.618 ($0.48).

Source: TradingView SPECIAL OFFER (sponsored) Binance Free $600 (exclusive of CryptoPotato): Use this link to register a new account and receive an exclusive welcome offer of $600 to Binance (full details).

2024 LIMITED OFFER on BYDFi Exchange – Up to $2888 Welcome Reward, Use this link to register and open a 100 USDT-M position for free!

Disclaimer: The information found on CryptoPotato is that of the quoted writers. It does not represent CryptoPotato’s views on whether to buy, sell or hold any investment. You are advised to do your own research before making any investment decisions. Use the information provided at your own risk. See disclaimer for details.

TradingView Cryptocurrency Charts.