With Bitcoin (BTC) in the limelight for the past few months, the Altcoin XRP (XRP) has done quite well itself.. Bitcoin’s rally has been linked to institutions and Wall Street entering this new class of digital asset and store of value. In the meantime, XRP has overcome a multi-year downward trend in order to pick up speed again.
But still, The price of XRP has not yet surpassed the $ 1 mark, despite the Flare Network air drop planned for December 12 just around the corner.
Is this latest move a classic example of “buy the rumor, sell the news” or should a further increase be expected? Let’s take a look at the charts.
XRP hits its first highest high since January 2018
The XRP / USD pair has shown some impressive numbers in the past few weeks as the token rose from $ 0.22 to a high of $ 0.80. This is a classic XRP price action as rallies are vertical and volatile rather than organic and gradual. The latest move is no exception as the price can skyrocket in a matter of days.
But still, The latest move broke a multi-year downtrend, as the graph shows. This downtrend was broken and set a new higher high. In fact, this is the first highest high since the bear market began in January 2018.
Likewise, A smaller rally took place in August, raising the XRP price from $ 0.16 to $ 0.33. Following this move, XRP price corrected to its previous resistance area at $ 0.22. This correction marked a bullish reversal of support and resistance, after which the massive move towards $ 0.80 followed and hit as high as $ 0.90 on Coinbase last month.
A correction seems to be imminent after such a move
XRP price moves often give a signal before such vertical price moves that a wider correction begins.. The table above shows four previous XRP moves that are similar to the last one.
These large vertical movements usually occur after a lengthy correction, which can take weeks to months, to set the stage for the next impulsive movement.
This is not a bad result as impulsive movements often require such corrections before moving up any further. Often times, these impulsive moves are corrected towards the previous area of resistance to detect a bullish change from support to resistance.
See levels with XRP
The daily timeframe indicates some nice levels that XRP traders or investors should look out for. These levels are based on historical price action as both key zones are past resistance areas.
The first is at $ 0.45, which has been tested over the past few weeks. As Bitcoin corrected to $ 16,200, the XRP / USD pair fell sharply towards $ 0.45, causing a switch from support to resistance.
This confirms the current massive correlation between cryptocurrencies. Altcoins can go bullish again as long as Bitcoin remains stable. However, once bitcoin begins to correct itself, altcoins suffer and often suffer greater losses than bitcoin.
If Bitcoin makes a bigger correction in the next period, the second important area investors should look out for is the $ 0.32 area. This level served as a zone of resistance for over a year which would make a move from support to resistance here extremely optimistic.
Both zones are proving to be very bullish on XRP, although they are certainly very painful for investors who bought over $ 0.70. Hence sIf XRP price consolidates above $ 0.45 or $ 0.32, it will set another higher low for the markets.
This graph provides a simple overview of the market structure and shows that the recent rally has reached the first high after a multi-year bear market since early 2018.
After a higher peak, a higher low must be set in order to continue the uptrend. If either zone turns into a new support zone, XRP price will be ready to set a new higher high at the next momentum.. That higher high will open the door for XRP price to hit $ 1.00 and possibly as high as $ 1.50 in the coming months.
The views and opinions expressed here are solely those of author and do not necessarily reflect the views of Cointelegraph. Every investment and trade movement involves risk. You should do your own research when making a decision.