Why XRP’s +10% recovery is not without its pitfalls
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- XRP struggled to lock recent gains above $0.50 at press time.
- More long positions were liquidated before the weekend (23 – 24 September).
Crypto market bears gained more ground post-Fed decision on Wednesday (20 September). For example, Bitcoin [BTC] dropped below $27k and eased to $26.4k at the time of writing.
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Similarly, Ripple [XRP] retreated from $0.52 and struggled to lock recent gains above $0.50 at press time.
Further losses for BTC couldn’t be overruled as there was no catalytic event in the short term. If so, XRP could record more losses, giving the bears an extra market edge.
Can XRP sustain the recovery?
The price action was above the short-term trend at press time, as shown by the 50-EMA (Exponential Moving Average) acting as a dynamic support. Since 11 September, XRP extended recovery to hit +10%, based on the recent low ($0.4950) and high ($0.5254).
But an extended BTC reversal could complicate matters for XRP bulls. In such a scenario, XRP could breach the 50-EMA and ease at the weekly bullish order block of $.4575 – $0.4935 (cyan).
However, XRP bulls could only showcase bullish intent if they reclaim the immediate resistance level ($0.5130). Even so, they must deal with the roadblocks at $0.549 and $0.597
Interestingly, the RSI and CMF retreated but fronted a sideways movement a few hours before press time. It underscores eased buying pressure and capital inflows, followed by stagnation at the time of writing. A narrow consolidation below $0.5130 could happen if the trend extends.
More long positions liquidated
According to liquidation data from Coinglass, XRP recorded increasing liquidation of long positions from 21 September. It reinforces the possible short-term bearish sentiment into the weekend.
How much are 1,10,100 XRPs worth today?
Besides, the futures’ market volume and Open Interest rates data were negative at press time. It further cements a bearish inclination.
So, extra losses couldn’t be overruled for XRP into the weekend, especially if BTC extends reversal below $26.4k.