The short-term charts of XRP indicate that the market is developing the next phase of the larger correction. The B wave, which just occurred, was more than anticipated and created an ABC correction that led to a drop to the 0.618 level at $2.09.
This region has served as strong support for a B wave, thus opening the way for the forthcoming C wave. Traders are focusing on the level of $2.26 as the primary target for a golden retracement, with a slight break above to the level of $2.28 being possible, as the Fibonacci extensions line up there. The C wave will consist of five smaller waves, indicating a possible bullish action during the correction.
However, resistance is still quite strong. XRP is currently sitting below a bearish trend line that has been capping price rallies since the old highs at $2.40-$2.45. Breaks above this level have been unsuccessful, indicating that there are sellers present and that there is not much buying power. A strong break above $2.18 is required to confirm a trend change.
Failure to Hold Could Lead to Deeper Declines
The lines are at several points of Fibonacci and obvious demand areas. This indicates that buyers are defending it so that prices do not go lower. If this level fails to hold, XRP may go lower, with the next strong support at $2.02-$2.00. Breaking below this level may spoil the current bullish analysis and make way for $1.65, which is the bigger Wave 3 macro support.
On the positive side, the recapture of $2.15-$2.18 could allow XRP to target $2.28-$2.30, followed by $2.33-$2.36. These targets are based on Fibonacci extensions from higher time frames and areas of liquidity. The recapture of these areas would be the first sign that the larger correction is about to give way to a more bullish scenario.
XRP Hourly Momentum Shows Mild Improvement
Momentum indicators are a mixed bag. The hourly RSI is in the mid-50s with a small bullish indicator, indicating that momentum is improving but not enough to break out.
On the daily chart, the RSI is in the high 40s, indicating that buyers are having trouble taking control. The MACD is indicating that momentum is weakening after a brief bullish crossover, and the realized volatility has fallen to the low 50s.
Also Read: XRP Break Above $2.23 Could Trigger 9%–11% Move Toward $2.36
