XRP, the digital asset associated with Ripple, has been making waves in the cryptocurrency market. Following a staggering 464% surge in November, the asset has consolidated around the $2 to $2.60 range. However, analysts remain optimistic, predicting an even more explosive rally that could potentially make XRP holders “the richest people you know.”
Technical Analysis Points to a Breakout
Crypto analyst Steph has highlighted several technical indicators that point to a potential breakout for XRP. The Bollinger Bands on the 4-hour chart, which measure volatility, are currently expanding, a pattern often preceding significant price movements. Historically, similar expansions have led to 53%, 120%, and even 132% rallies for XRP.
Additionally, XRP has recently broken out of a bullish flag pattern on the daily chart, indicating a continuation of the upward trend after a period of consolidation. The asset is currently holding above the crucial support level of $2.33, reinforcing the bullish outlook. A daily close above the resistance level of $2.60 would further confirm the breakout, with a potential target of $4.90 to $5 in the short to mid-term.
Bitcoin Dominance Favors Altcoins
The declining Bitcoin dominance, which measures Bitcoin’s market share relative to other cryptocurrencies, is another positive factor for XRP and other altcoins. Bitcoin dominance has broken below a rising wedge pattern on the weekly chart and is currently testing the breakdown level near 59%. As long as it remains below this threshold, conditions remain favorable for altcoin rallies.
A Word of Caution
While the overall outlook for XRP remains bullish, it’s important to exercise caution as Bitcoin dominance approaches the 47-50% support zone. This level could potentially mark a turning point, leading to a reversal in the altcoin market. However, for now, the technical indicators and market sentiment suggest that XRP is poised for further gains.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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