Analysis
XRP pumps 12.8% as bulls make a strong case for breakout past $0.55
Posted:
| Last updated: January 30th, 2024
Journalist
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- XRP has strong short-term bullish momentum and sentiment
- The daily chart also reflected bullishness, but the $0.55 level was critical
Ripple [XRP] posted impressive gains over the last week following Bitcoin’s [BTC] move past the $30k mark. Comparisons between the XRPL Ledger and the Bitcoin Lightning Network came to the fore over the weekend. You can learn more here.
Is your portfolio green? Check the XRP Profit Calculator
On the price action front, AMBCrypto highlighted that a move past the $0.5 psychological level could be immense for the XRP bulls. But we still haven’t seen the $0.55 resistance cleared. Can the bulls make it happen this week?
The resistance zone from August stands in the way of XRP bulls
Source: XRP/UDST on TradingView
The one-day chart of XRP noted a bullish market structure developed over the past ten days. Yet, the importance of the local highs at the $0.55 level can not be underestimated. There was a bearish order block (red box) at the $0.513-$0.55 region from late August.
XRP traders also established a range (orange) that stretched from $0.47 to $0.55. The mid-range level was at $0.51 and has been tested several times as both support and resistance. This fact added to the credibility of the range.
The Relative Strength Index (RSI) was able to climb above neutral 50 and indicated bullish momentum was gathering strength. The Directional Movement Index (DMI) also signaled a significant uptrend in progress as the Average Directional Index (ADX) (yellow) rose past the 20 mark. On the other hand, the On-Balance Volume (OBV) was yet to scale the local resistance, which suggested buying volume was underwhelming in recent weeks.
The short-term demand was positive and accumulation reflected investor confidence
Source: Santiment
Contrary to the OBV, the mean coin age has trended higher since early September. This was a sign that XRP tokens did not see much movement between addresses and that holders were likely accumulating.
The Market Value to Realized Value (MVRV) token was negative, and a push into the positive territory could see some profit-taking activity from holders. The dormant circulation highlighted a lack of intense selling in October and was a metric traders could keep an eye on.
Source: Coinalyze
The spot Cumulative Volume Delta (CVD) saw a downtrend from 20 October to 22 October while prices shot higher. This was worrisome for the bulls, but the CVD saw a bounce in recent hours. Meanwhile, the Open Interest and the price trended higher. This called attention to the strong bullish sentiment in the futures market in the near term.
Realistic or not, here’s XRP’s market cap in BTC’s terms
A move to $0.55 appeared likely. A breakout past this level and a subsequent retest could be used to enter long positions. The next major resistance levels were at $0.585 and $0.667.
