XRP bulls defend $0.517-level, but will the uptrend continue?
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- The market structure showed signs of flipping to bearish, but the uptrend was not yet broken.
- Buying pressure behind XRP was steady in June even though sentiment in the crypto space was bleak.
At a time when Bitcoin and a good chunk of the altcoin market trended downward, XRP remained on the uptrend initiated in mid-May. This lower timeframe bullishness was reinforced by the daily timeframe price action as well.
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Investor sentiment was on the rise, as was Open Interest in the asset. While a verdict in the dispute between the SEC and Ripple Labs [XRP] was not yet out, the XRP community remained positive that it would go their way.
The 50% retracement level was defended despite a shift in character to bearish
The XRP market structure has been bullish on the daily timeframe since March, after the January rally set a higher low on the long-term price chart. On the shorter-term charts, this bullish bias was challenged in early June.
The higher low at $0.501 marked in orange was briefly violated on 5 June. This signaled bearish intent. Moreover, XRP bears were able to form a lower high at $0.5384. However, even though the market leaned in favor of the bears on H4, the trend remained bullish. In order to shift the trend, XRP must fall below $0.4867.
A set of Fibonacci retracement levels were plotted based on Monday’s move. They showed the 50% retracement level at $0.5169 was defended but noted candlewicks below this level, once again underlining bearish intent.
However, the RSI remained above neutral 50 to show upward momentum. The OBV has also been in an uptrend in the past two weeks, denoting strong buying pressure behind XRP. A move above $0.538 will likely see XRP move higher once more.
The mean coin age took a hit but was the dormant circulation a greater concern?
The 90-day mean coin age was in an uptrend from late March to late May. It took a sharp drop on 1 June, when the 90-day dormant circulation also posted a six-month high. This surge underlined the chance of intense selling pressure in the market.
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Yet the selling volume was not high, and furthermore the mean coin age metric began to rise higher once more. The MVRV ratio of XRP was positive as well, showing short-term buyers held unrealized profits. A rise in MVRV could presage a wave of profit taking.