XRP/USD - Will the bulls take charge? A higher time frame look.
What do we have here?
Looking at XRP on the weekly. First thing that jumps out to me is location.
Location looks great. Investment grade. Throughout the later half of 2018 and in to 2019 we based right off the original market structure breakout level at $0.2999 in 2017.
Certainly not in shorting location on this weekly chart.
The 2018 lows at ~$.0.24 seem to be holding as strong support. Makes for a nice stop level if you're taking long shots.
Volume profile indicates the majority of 'business that's been done' on XRP was right around 30 cents - basically where we've been trading for the last 10 months. Nice sideways consolidation / accumulation action in price action corresponding with those levels. To me this says, "The majority of bag holders who bought and never sold the last bull market are exchanging their XRP for USD at around $0.30." Haha. Kind of cheeky, I get it.
You can see we're finding resistance at the downtrend line drawn from the 4/20/18 counter trend rally. Before I think about adding to my position here I need to see this downtrend line traded through with a market structure breakout on the opposite side. We're at least a few weeks out from seeing that.
I've talked before about the inverse correlation we see between
BTC.D
and XRP. It's especially pronounced when you look at altcoins vs. BTC, however, it's still valid comparing vs. USD.
Titled "BTC Dominance as Proxy for Altcoin Sentiment," you can see that chart here:
That being said, we got a nice big M top come in within BTC Dominance. I've found this to be an extremely powerful bullish signal for the other coins like XRP.
Makes total sense, right? Money is flowing out of BTC, where's it going? Things like XRP.
I do like the similarities between the market we were seeing in the later half of 2017 to what we're seeing now. BTC lead the market, you could see its dominance rising aggressively day by day, until eventually BTC stalled out up top, traded in a range, and all the money started pouring in to the altcoins.
I'm seeing very similar action in today's market. BTC trading range bound between ~$7.5k - ~$9.1k, BTC dominance starting to break down, alts starting to perk up and put in nice market structure bottoms. Looks to me like the perfect storm brewing for an altcoin rally over the next few weeks or months.
XRP/USD Internals
Not shown on this chart because there would just be too much information and it would look like a mess. Maybe I'll make another chart if you guys are keen to see how I identify confirmed divergence.
What I'll say is that there is confirmed bullish momentum divergence within the MACD.
We've been stupidly oversold for a hell of a long time - pretty much regardless of what kind of momentum oscillator you use. RSI, Williams %R, stochastics, whatever.
I'm seeing bullish volume breakouts expressed through On Balance Volume (OBV).
Put it all together and the internals are looking rock solid for a reversal.
As far as projections / profit targets go:
What sticks out to me is the confluence of harmonic levels lining up around $1.41.
- .382 fib retracement (drawn from 2018 top @ $3.30 down to 2018 low @ $0.24653)
- 1.618 fib extension (drawn from April '18 top @ $0.966 down to 2018 low @ $0.24653)
Very rarely do you see longer time frame harmonic levels line up this closely. In my experience when you see this it ought to be respected and paid close attention to.
Also very rarely do we see markets go down and never see at least a 38.2% retracement of the old highs. Myself and many harmonic traders alike use 38.2 as a "first stop target." First stop should imply that this isn't an aggressive profit target by any means.
XRP/USD Weekly Chart Summary
Is any of this making sense? I hope so.
Overall I think the technicals look great. Location, internals, market structure, intermarket-wise. Lots of independent reasons for a trade here.
Again, this doesn't mean go and market buy XRP. Follow your trading plan. (Do I have to keep saying this?)
Doesn't take a rocket scientist to examine the downside (break of those ~$0.24 lows) and the upside ($1.41 as 38.2%) retracement. Clearly there's a lopsided risk:reward ratio here.
High potential reward. Low downside risk.
That's what this game is all about. If you're the guy who likes these types of opportunities, maybe this is an idea to chew on.
FREE TRADING EDUCATION
We talk about all of this stuff every day Monday through Friday in our 100X Challenge livestreams on Youtube. You can check those out here.
If you want to learn the basics of technical analysis, risk management, setups, and the fundamental principles of profitable trading - Check out our Level 1 course.
We're giving it away for free right now (will sell for $2497) for Tradingview users to beta test over the next few weeks. Over 20 hours worth of content, brings you from the ground up and gets you analyzing charts like smart money.
Use discount code 'Tradingview' in the checkout.
- learn more and get a free course preview here.
Cheers,
FromTheEther
DISCLAIMER:
This is not an attempt to shill
XRPUSD
XRPUSD
XRPBTC
in any way.
It's also not a buy recommendation.
Personally I'm not a big fan of the coin itself, but that doesn't stop me from trading it.
I'm a trader, not a financial advisor. By definition I look to identify and capitalize on high probability, high reward, low risk opportunities as often as possible. That's my job. That's what I do.
I'm just telling you what I'm seeing and trying to be as objective as possible while doing so.
OK! Talk to you soon.
Looking at XRP on the weekly. First thing that jumps out to me is location.
Location looks great. Investment grade. Throughout the later half of 2018 and in to 2019 we based right off the original market structure breakout level at $0.2999 in 2017.
Certainly not in shorting location on this weekly chart.
The 2018 lows at ~$.0.24 seem to be holding as strong support. Makes for a nice stop level if you're taking long shots.
Volume profile indicates the majority of 'business that's been done' on XRP was right around 30 cents - basically where we've been trading for the last 10 months. Nice sideways consolidation / accumulation action in price action corresponding with those levels. To me this says, "The majority of bag holders who bought and never sold the last bull market are exchanging their XRP for USD at around $0.30." Haha. Kind of cheeky, I get it.
You can see we're finding resistance at the downtrend line drawn from the 4/20/18 counter trend rally. Before I think about adding to my position here I need to see this downtrend line traded through with a market structure breakout on the opposite side. We're at least a few weeks out from seeing that.
I've talked before about the inverse correlation we see between
BTC.D
and XRP. It's especially pronounced when you look at altcoins vs. BTC, however, it's still valid comparing vs. USD. Titled "BTC Dominance as Proxy for Altcoin Sentiment," you can see that chart here:
That being said, we got a nice big M top come in within BTC Dominance. I've found this to be an extremely powerful bullish signal for the other coins like XRP.
Makes total sense, right? Money is flowing out of BTC, where's it going? Things like XRP.
I do like the similarities between the market we were seeing in the later half of 2017 to what we're seeing now. BTC lead the market, you could see its dominance rising aggressively day by day, until eventually BTC stalled out up top, traded in a range, and all the money started pouring in to the altcoins.
I'm seeing very similar action in today's market. BTC trading range bound between ~$7.5k - ~$9.1k, BTC dominance starting to break down, alts starting to perk up and put in nice market structure bottoms. Looks to me like the perfect storm brewing for an altcoin rally over the next few weeks or months.
XRP/USD Internals
Not shown on this chart because there would just be too much information and it would look like a mess. Maybe I'll make another chart if you guys are keen to see how I identify confirmed divergence.
What I'll say is that there is confirmed bullish momentum divergence within the MACD.
We've been stupidly oversold for a hell of a long time - pretty much regardless of what kind of momentum oscillator you use. RSI, Williams %R, stochastics, whatever.
I'm seeing bullish volume breakouts expressed through On Balance Volume (OBV).
Put it all together and the internals are looking rock solid for a reversal.
As far as projections / profit targets go:
What sticks out to me is the confluence of harmonic levels lining up around $1.41.
- .382 fib retracement (drawn from 2018 top @ $3.30 down to 2018 low @ $0.24653)
- 1.618 fib extension (drawn from April '18 top @ $0.966 down to 2018 low @ $0.24653)
Very rarely do you see longer time frame harmonic levels line up this closely. In my experience when you see this it ought to be respected and paid close attention to.
Also very rarely do we see markets go down and never see at least a 38.2% retracement of the old highs. Myself and many harmonic traders alike use 38.2 as a "first stop target." First stop should imply that this isn't an aggressive profit target by any means.
XRP/USD Weekly Chart Summary
Is any of this making sense? I hope so.
Overall I think the technicals look great. Location, internals, market structure, intermarket-wise. Lots of independent reasons for a trade here.
Again, this doesn't mean go and market buy XRP. Follow your trading plan. (Do I have to keep saying this?)
Doesn't take a rocket scientist to examine the downside (break of those ~$0.24 lows) and the upside ($1.41 as 38.2%) retracement. Clearly there's a lopsided risk:reward ratio here.
High potential reward. Low downside risk.
That's what this game is all about. If you're the guy who likes these types of opportunities, maybe this is an idea to chew on.
FREE TRADING EDUCATION
We talk about all of this stuff every day Monday through Friday in our 100X Challenge livestreams on Youtube. You can check those out here.
If you want to learn the basics of technical analysis, risk management, setups, and the fundamental principles of profitable trading - Check out our Level 1 course.
We're giving it away for free right now (will sell for $2497) for Tradingview users to beta test over the next few weeks. Over 20 hours worth of content, brings you from the ground up and gets you analyzing charts like smart money.
Use discount code 'Tradingview' in the checkout.
- learn more and get a free course preview here.
Cheers,
FromTheEther
DISCLAIMER:
This is not an attempt to shill
XRPUSD
XRPUSD
XRPBTC
in any way. It's also not a buy recommendation.
Personally I'm not a big fan of the coin itself, but that doesn't stop me from trading it.
I'm a trader, not a financial advisor. By definition I look to identify and capitalize on high probability, high reward, low risk opportunities as often as possible. That's my job. That's what I do.
I'm just telling you what I'm seeing and trying to be as objective as possible while doing so.
OK! Talk to you soon.