Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be taken as investment advice
XRP has registered strong gains over the past few days, with the alt jumping from $0.58 to touch $1.11 on the charts, before retracing some of those gains. At the time of writing, XRP was holding on to the strong support at $0.925 and formed a triangle pattern. However, the direction of its next move had not yet been confirmed, although it was expected to be upwards.
XRP 1-hour chart
Source: XRP/USD on TradingView
On the charts, a symmetrical triangle was spotted (white). This pattern can see the price break the trendlines in either direction. However, this pattern seemed to be a continuation pattern. Hence, the price would follow the direction of the previous trend, in this case, upwards.
The Fibonacci retracement levels plotted based on XRP’s surge from $0.56 to $1.11 highlighted some levels of support, and the 23.6% and 38.2% retracement levels at $0.95 and $0.86 had been visited by the price.
The technical indicators showed some overextension before the corrections and appeared to signal that momentum was shifting back in the bulls’ favor once again.
Reasoning
There was a bearish divergence (orange) on the RSI preceding the fall to $0.86. Subsequent trading sessions saw bullish twin peaks form on the Awesome Oscillator. This was a buy signal and the AO also crossed above the zero line.
However, XRP had not yet broken out of the triangle pattern. A dip to the $0.88-$0.9 region can be seen to hunt for stop-loss orders before a breakout past $0.95.
There was also a slight chance that XRP will continue to trade sideways in the coming days. Unlikely, but possible, and this consolidation would be a chance to add to spot positions on the asset.
Conclusion
The next 24-48 hours could see XRP make a strong move north. The $0.925-level is a strong support level, and demand is likely to step in at the $0.88-$0.9 region too. If XRP drops under the $0.86 mark in the coming days, it is likely to head towards $0.79. Another breakout past $1 will likely see $1.1 retested.
