XRP is showing promising signs of recovery following a significant 18% drop, which saw its price fall from $2.7 to $2.08. This decline coincided with a broader downturn in the cryptocurrency market, triggered by Bitcoin’s retreat from $108,000 to below $100,000 after the Federal Reserve’s announcement of a 0.25% interest rate cut. Despite the bearish sentiment, renowned crypto analyst EGRAG believes XRP is poised for a potential bullish reversal.
XRP Finds Support Amid Decline
EGRAG’s analysis reveals that XRP found strong support in the $2.17–$2.27 price range after its drop to $2.2. This support zone, identified using a 1-hour chart, may serve as the foundation for XRP’s stabilization and potential recovery. Although the cryptocurrency currently trades below the 21-period Exponential Moving Average (EMA), which serves as the nearest resistance level, the tension between buyers and sellers remains palpable.
#XRP Quick Update 1 Hour Time Frame ( UPDATE):
— EGRAG CRYPTO (@egragcrypto) December 18, 2024
The #BULLS has Stepped IN. Trust the Process https://t.co/xQDzxuveIx pic.twitter.com/8fljp7iDYM
One of the key technical formations observed by EGRAG is the development of a potential double-bottom structure, a bullish reversal pattern. The first bottom formed when XRP dropped to $2.33 on December 16, only to rebound to $2.72 following the launch of Ripple’s stablecoin, RLUSD. The second bottom was marked by the recent decline to $2.17. If XRP consolidates within this support range, it could signal the beginning of a recovery. However, for the double-bottom pattern to confirm, XRP must surpass the neckline resistance at $2.7.
Technical Indicators Point to Bullish Momentum
EGRAG’s analysis is further supported by key technical indicators, which suggest a growing bullish momentum. The Relative Strength Index (RSI), which recently hovered around 70, points to increasing buying pressure. A breakout above this level could pave the way for further strength, with the RSI potentially reaching 90. Additionally, the Moving Average Convergence Divergence (MACD) histogram has flipped positive, reinforcing the possibility of an upward trend. The Average Directional Index (ADX) has also improved, indicating a strengthening trend.
XRP’s Short-Term Outlook
Earlier forecasts by EGRAG indicated two possible short-term scenarios for XRP’s price action. Scenario A suggested a breakout above $2.5, leading to upward momentum, while Scenario B predicted a dip to $2.27, followed by consolidation in the $2.17–$2.27 range. The recent market activity appears to align with Scenario B, with XRP testing the $2.2 level and finding support. This consolidation phase is expected to set the stage for a breakout once key moving averages align, establishing a stronger foundation for sustained growth.
Also Read: Ripple News: Messari Founder Criticizes XRP as Market Turmoil Drives 21% Price Drop
Currently trading at $2.27, XRP has experienced an 8.26% decline in the past 24 hours. Investors are closely monitoring potential interactions with the $2.39 EMA resistance and the $2.7 neckline, looking for confirmation of a bullish reversal.
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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