XRP’s 180% November Rally Driven by ETF Filing — Price Pullback May Follow

Key Takeaways

• Ripple’s XRP broke out from a long-term symmetrical triangle.
• The XRP price reached a 1,280-day high of $1.63 last week.
• Will the increase continue, or has XRP reached a local level?

After several years of trading without any volatility, the XRP price broke out in November and has increased by 190%. This is the largest monthly candlestick since April 2021. The price is quickly approaching its 2021 cycle high at $1.96.

Positive Ripple news also exists, as WisdomTree has filed for an XRP ETF in the state of Delaware. Ripple also  partnered  with Archax and Abrdn to bring the first tokenized money market fund to the XRP Ledger. Analyst Armando Pantoja also pointed out  that XRP whales bought over 50 million tokens during the weekend, likely in anticipation of trend continuation.

However, short-term signs of weakness are in place, allowing for the possibility that XRP has reached a local top and will retrace in the short term. Let’s examine the price action and see what lies ahead.

XRP Price Breaks Out

The weekly XRP chart shows that the price has consolidated inside a symmetrical triangle since the start of 2021. The resistance and support trend lines were validated several times and came close to converging in November before XRP finally broke out.

The wave count supports the breakout and gives a target of $2.39. According to the wave count, the triangle is wave B in the A-B-C corrective structure (white). The sub-wave count is in black, showing a completed A-B-C-D-E structure, leading to the triangle breakout.

Technical indicators do not show any weakness. The Relative Strength Index (RSI) and Moving Average Convergence/Divergence are increasing and neither has generated any bearish divergence. So, the upward movement will likely continue in the long term. A closer look at a shorter-term chart to see if an initial correction is due before the price reaches its target.

Short-Term Weakness?

While the weekly time frame is extremely bullish, the shorter-term six-hour one suggests a retracement will occur because of the wave count, XRP price action, and indicator readings. The wave count shows a completed five-wave increase (black) that started on Oct. 25. The symmetrical triangle in wave four characterizes this upward movement.

Wave five may have ended since it reached the 2.61 external Fibonacci retracement of wave four. Also, depending on the slope of the parabolic trend line (white), the XRP price may have broken down below it. Finally, the six-hour RSI has already generated a bearish divergence (green), often associated with the top of upward movements.

If so, the XRP price could correct toward the 0.5 Fibonacci retracement support level at $1.07 before resuming its ascent.

On the other hand, reclaiming the parabola and increasing above $1.60 will mean the upward movement will extend immediately, taking the XRP price toward its $2.39 target.

Local Top Could Be In

XRP has been one of the best-performing cryptocurrencies in November, increasing by 180%.

However, the price may have reached a local top. It could correct toward $1.07 before resuming its upward movement.

About the Author

Valdrin Tahiri

Valdrin discovered cryptocurrencies while getting his MSc in Financial Markets from the Barcelona School of Economics in 2017. He has been an avid investor and trader since. Valdrin has written for several cryptocurrency media companies such as BeInCrypto and CoinGape.

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