In recent days, one of the most sought-after altcoin projects among Turkish investors may be nearing the end of the rally. FXStreet analyst Akash Girimath advises traders to be wary of a steep retracement.
Here are two reasons for the steep straightening
XRP (XRP) rallied over 40% from September 22 to 23 after the positive course of the litigation process. The price is now showing an interesting development pointing to a potential pullback on the shorter time frame. The wider time frame also harbors the possibility of a pullback after its last explosive move.
XRP is currently forming a descending triangle formation on the hourly chart as seen below. This development heralds a fix for XRP. Price action around this pattern defines a descending triangle when connected using trend lines.
This pattern measures the distance between the first local top and bottom, yielding an estimate below $0.450. According to the pattern, XRP price will continue to face a 15% bearish pressure to $0.386. However, it should be noted that the price has increased by 74 percent in less than eight days. As a result, it is reasonable in many ways to expect a steep pullback of up to 15%. Such an exponential movement is often followed by investors booking profits. This results in a pullback.
Fortunately for XRP price, the midpoint of the 74% rally to $0.449 is just below the breakout point. This level will slow down the bearish momentum somewhat. However, traders can still wait for Ripple to drop to $0.423 or below the next support to $0.404.
Altcoin market watches Ripple and SEC lawsuit
On the daily time frame, we see XRP price dipping from the $0.331 range before starting the 74% rise, which is close to retesting the $0.596 resistance area. Profit taking and worsening market conditions drove the altcoin price down roughly 15%. If the $0.464 support structure is breached, the bears are strong enough for further declines. In this case, XRP price will bounce back to the $0.331-$0.464 region. The daily demand zone stretching from $0.381 to $0.433 is an important foothold to stop the decline.
However, the main developments that will stop the decline stem from the basic news feed. cryptocoin.com As we have also reported, Ripple has gained a significant advantage in the case.
A lawsuit in favor of Ripple will be explosive for XRP, as we saw from the last rally. Analyst Girimath expects a massive rally from $0.561 to $0.596 in this scenario as well. If we overcome this resistance, another 100% price increase is at the door, according to the analyst. $0.914 is the first of the final price targets that the bulls longed for.
On the other hand, XRP bulls can rally in the $0.561 to $0.596 region. This time, weakness and excessive selling pressure will emerge among buyers. In such a case, a daily candlestick near the $0.384 support level will invalidate the bullish thesis for Ripple. This move could see XRP price drop into the low range from $0.331. Here, buyers can finally try a recovery rally.
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