On 9/18/2018, XRP gained 197.4% in 4 days fueled by over 1.24 billion of volume on Binance alone. Since then, all attempts to break above the bearish upper trend line (red) ended in rejection. Ever since BTC started its run on 4/1/2019, the XRP/USD chart didn't offer much insight into what would happen next.
In my last analysis I used the XRP/BTC chart because it told a much clearer story. While BTC has been rising since the beginning of 2019, XRP/BTC declined creating several reversal formations. While that pairing dropped below the supports I identified, it was due to BTC continuing to break above major resistance areas from $5,800 on up to current levels.
Despite the XRP/BTC decline, the XRP/USD price stayed relatively level, dipping no more than 10% before breaking out to ~$0.46 as of the daily candle closing 30 minutes ago. That marks an increase of ~50% from when I wrote that analysis on 5/1/19.
So what's next? In the last 3 days Binance has seen over a billion of XRP volume and is well ahead of the 9/18/19 rally that had 539.86 million of volume (and at a lower price point) over its first 3 days. The difference, however, is that during the 9/18/18 rally the volume increased over the first 3 days whereas the volume peaked on day 2 and dropped off on day 3 (but is well above the moving average).
Right now the price is trading below the teal horizontal line which represents the average trading price based on volume ever since Binance offered a XRP/USD pair and it happens to be right in the middle of the .236 and .382 Fib.
In the last 36 hours BTC has moved above yet another critical support baseline that should act as resistance (and has for 3 days). If it continues higher ~$9,100 and $10,000 (+10% & +21%) are the next areas of resistance. If it fails it would find support around $7,700 (-7.25%).
If BTC drops to $7,700, XRP could drop to the .236 Fib ($0.41) a decline of 12% which would be reasonable given the ties to BTC movements.
However, XRP has gone against the BTC grain in the past and risen when BTC drops.
If BTC were to continue moving upward, XRP could either slowly tick upwards or explode. Here are the key levels where XRP may hit resistance:
Fib's .382 ($0.51), .5 ($0.59), .618 ($0.67) and .786 ($0.78).
There's a few cross support now resistance lines (dotted yellow) that coincide in the $0.53-0.62 range and at $0.78.
If XRP were to mimic the 9/18/18 rally, I could see it happening in the very short term. The volume is there, the accumulation structure is in place and frankly this is what XRP does.
I track the performance of other tokens to see how far they've risen (or fallen) in relation to one another. Since start of 2019 BTC has risen 119.76%, LTC 248.76%, ETH 101.34% and what about XRP? As of this post XRP is $0.462 which means it has risen 30.96% since the beginning of this year.
I'm not going to go deep into factors outside of charting/TA but I will say this: XRP has the tech, usage and leadership (who have access to the right relationships) to be one of, if not the leading token to be adopted for mainstream use. So why is it lagging so far behind? I don't know. Crypto is very speculative and tokens that have a fraction of what XRP has to offer have made bigger gains which simply tells me that it's only a matter of time before XRP catches up. The real question is if it'll catch up when BTC is going up or if it becomes a safe haven when BTC and other alts are dropping.
My personal feeling of what XRP will do next has nothing to do with charting/TA and is only based on my experience/observation and it's that XRP will really explode when everything else starts tanking. My reasoning is that all those gains from BTC and alts since the beginning of the year will be taken for profit at some point (and quickly when the market starts to correct) and will lead to a major selloff. In addition, new trades that were made at these higher levels will sell or trigger stop losses, accelerating the decline.
Normally BTC/alts would be sold into cash/Tether but there's a lot of questions and uncertainty surrounding Tether (one of the theories fueling this bull run) and I can see people who don't want to hold Tether putting it into something that is less susceptible to drops like XRP. Moreover, even in an up market people will sell other positions to get in on XRP when it goes parabolic. If XRP blasts off while everything else is dropping then that would lead to a massive influx of buying from the selloff of other tokens and the proceeds would be used to buy XRP. This would allow profits from other tokens to be taken without having to hold Tether and would appeal to those who see XRP as a safe haven to protect their profits or as an opportunity to make compounded profits.
At $0.46 XRP isn't oversold, it's underbought. There's much to gain when XRP realigns itself with the market (my estimate would be anywhere between $0.50-0.78, closer to $0.78) and in the scenario I laid out above there's a strong argument it may not only catch up but in the mid to long term outperform expectations like we haven't seen since the end of 2017/beginning of 2018.
I started writing this before the daily candle closed and as in the last 5 minutes, XRP has broken above the teal line.
In my last analysis I used the XRP/BTC chart because it told a much clearer story. While BTC has been rising since the beginning of 2019, XRP/BTC declined creating several reversal formations. While that pairing dropped below the supports I identified, it was due to BTC continuing to break above major resistance areas from $5,800 on up to current levels.
Despite the XRP/BTC decline, the XRP/USD price stayed relatively level, dipping no more than 10% before breaking out to ~$0.46 as of the daily candle closing 30 minutes ago. That marks an increase of ~50% from when I wrote that analysis on 5/1/19.
So what's next? In the last 3 days Binance has seen over a billion of XRP volume and is well ahead of the 9/18/19 rally that had 539.86 million of volume (and at a lower price point) over its first 3 days. The difference, however, is that during the 9/18/18 rally the volume increased over the first 3 days whereas the volume peaked on day 2 and dropped off on day 3 (but is well above the moving average).
Right now the price is trading below the teal horizontal line which represents the average trading price based on volume ever since Binance offered a XRP/USD pair and it happens to be right in the middle of the .236 and .382 Fib.
In the last 36 hours BTC has moved above yet another critical support baseline that should act as resistance (and has for 3 days). If it continues higher ~$9,100 and $10,000 (+10% & +21%) are the next areas of resistance. If it fails it would find support around $7,700 (-7.25%).
If BTC drops to $7,700, XRP could drop to the .236 Fib ($0.41) a decline of 12% which would be reasonable given the ties to BTC movements.
However, XRP has gone against the BTC grain in the past and risen when BTC drops.
If BTC were to continue moving upward, XRP could either slowly tick upwards or explode. Here are the key levels where XRP may hit resistance:
Fib's .382 ($0.51), .5 ($0.59), .618 ($0.67) and .786 ($0.78).
There's a few cross support now resistance lines (dotted yellow) that coincide in the $0.53-0.62 range and at $0.78.
If XRP were to mimic the 9/18/18 rally, I could see it happening in the very short term. The volume is there, the accumulation structure is in place and frankly this is what XRP does.
I track the performance of other tokens to see how far they've risen (or fallen) in relation to one another. Since start of 2019 BTC has risen 119.76%, LTC 248.76%, ETH 101.34% and what about XRP? As of this post XRP is $0.462 which means it has risen 30.96% since the beginning of this year.
I'm not going to go deep into factors outside of charting/TA but I will say this: XRP has the tech, usage and leadership (who have access to the right relationships) to be one of, if not the leading token to be adopted for mainstream use. So why is it lagging so far behind? I don't know. Crypto is very speculative and tokens that have a fraction of what XRP has to offer have made bigger gains which simply tells me that it's only a matter of time before XRP catches up. The real question is if it'll catch up when BTC is going up or if it becomes a safe haven when BTC and other alts are dropping.
My personal feeling of what XRP will do next has nothing to do with charting/TA and is only based on my experience/observation and it's that XRP will really explode when everything else starts tanking. My reasoning is that all those gains from BTC and alts since the beginning of the year will be taken for profit at some point (and quickly when the market starts to correct) and will lead to a major selloff. In addition, new trades that were made at these higher levels will sell or trigger stop losses, accelerating the decline.
Normally BTC/alts would be sold into cash/Tether but there's a lot of questions and uncertainty surrounding Tether (one of the theories fueling this bull run) and I can see people who don't want to hold Tether putting it into something that is less susceptible to drops like XRP. Moreover, even in an up market people will sell other positions to get in on XRP when it goes parabolic. If XRP blasts off while everything else is dropping then that would lead to a massive influx of buying from the selloff of other tokens and the proceeds would be used to buy XRP. This would allow profits from other tokens to be taken without having to hold Tether and would appeal to those who see XRP as a safe haven to protect their profits or as an opportunity to make compounded profits.
At $0.46 XRP isn't oversold, it's underbought. There's much to gain when XRP realigns itself with the market (my estimate would be anywhere between $0.50-0.78, closer to $0.78) and in the scenario I laid out above there's a strong argument it may not only catch up but in the mid to long term outperform expectations like we haven't seen since the end of 2017/beginning of 2018.
I started writing this before the daily candle closed and as in the last 5 minutes, XRP has broken above the teal line.
Trade active:
I forgot to mention a few things to look for over the next 24 hours. If today's candle closes between $0.49-0.53, it'll make a nice 3 white soldiers candle formation. When 3 white soldiers form after a drop or (in the case of XRP) after stable prices it's a sign of strength. Conversely, if today's candle closes under the teal line that would make an evening doji and a pullback to the .236 Fib would be in play.
Also, I don't care what the MACD and RSI have to say about XRP being overbought. I find that when price action is stagnant both those indicators have more value. In crypto, particularly XRP, the MACD and RSI scream oversold or overbought when there's a major movement either way and frankly all they really do is mark the beginning of an up or down trend. In that respect it's another indication that XRP is getting primed for a big move upwards.
Also, I don't care what the MACD and RSI have to say about XRP being overbought. I find that when price action is stagnant both those indicators have more value. In crypto, particularly XRP, the MACD and RSI scream oversold or overbought when there's a major movement either way and frankly all they really do is mark the beginning of an up or down trend. In that respect it's another indication that XRP is getting primed for a big move upwards.
Comment:
Correction: if today's candle closes under the *horizontal teal line.* My apologies, I probably shouldn't have used teal lines in the comparison.
