This week, XRP first displayed some signs of price stabilization as the token began to form a candlestick formation, which frequently happens before a price recovery. In the meantime, Bitcoin’s breaking out of a downward trendline has drawn attention to traders, but significant obstacles still lie in the way before a sustained breakout can be established.
XRP: Rotating Bottom Indicates Buyer Action.
XRP posted a so-called spinning bottom on Monday. The candle was formed after a severe sell-off, and the intra daily fluctuations of the high and low prices ended up at the close of the day at approximately the same price as when the day started. This kind of price behaviour represents a short-lived equilibrium between buyers and sellers. It can be a good indicator of revised demand when it occurs after a long pullback.
The position of XRP follows its 25 percent downturn since July, when the token hit its high of $3.65. The latest trend is almost at the August low, which was once strong support. Although this does not necessarily indicate a turnaround in the trend, it indicates that sellers might be losing control, and buyers are starting to defend the price more ferociously.
To confirm this, analysts will seek a convincing move beyond Monday’s high of $2.84. As of this writing, XRP is trading just above $2.80, which places the token just outside a possible bullish break.
Bearish Momentum: Momentum in the short term continues.
Irrespective of the positive candlestick, short-term trends are skewed to the negative. The 5- and 10-day simple moving averages (SMAs) remain sloping downward, indicating that the sellers are continuing to exert pressure. The Guppy multiple moving average indicator, a combination of short—and long-term averages, is also bearish-biased.
Should XRP fall to Monday’s low of $2.69, the decline may speed up to the swing of $2.65 in May or even the 200-day SMA of around $2.48. The bigger picture is to exercise caution until the bulls regain the higher levels.
The Undercurrents are revealed in Momentum Indicators.
Interestingly, the popular momentum gauge or MACD histogram has remained negative since late July, yet the prices have not deteriorated to a significant level. Rather, XRP has stayed within a relatively constant price range of 2.70 and 3.00. This strength against negative momentum usually gives way to powerful rallies after a bullish crossover.
This is the case with Bitcoin in September 2024, when the top cryptocurrency had hovered around $60,000 with poor momentum but then proceeded to move up strongly.
In the case of XRP, the support levels are 2.69, 2.65, and 2.48. Resistance can be seen in the future at $2.84, $3.38, and finally, the July high of 3.65.
Bitcoin Breaking Trendline, however, Clouds.
Bitcoin, on its part, has advanced beyond a downward trendline that was formed using record highs above $124,000. This action has relieved some short-term selling pressure, but the future is unclear. The crypto continues to trade below several other substantial obstacles, such as the Ichimoku cloud and the 50- and 100-day SMAs.
To further warn us, the monthly RSI exhibits a bearish divergence, which indicates declining momentum on longer time scales. BTC would have to burst and hold levels above the Ichimoku cloud to swing the storyline decisively.
Outlook
Until the next day, XRP showed indicators of possible recovery, and BTC was stuck on strong resistance. Traders will remain on the lookout until either XRP or BTC confirms a recent move: a break above $2.84 and a burst away from the Ichimoku cloud. Up to that point, rallies can be met with a grain of salt and even profit-making.
