XRP Price Recovery Shows Promise but Faces Critical Resistance Ahead

Key Takeaways

• The XRP price trades inside a descending wedge pattern.
• XRP reclaimed the $2.05 horizontal support area.
• Will the asset break out from the wedge and move to new highs?

On April 15, Ripple announced the integration of its RLUSD stablecoin into the Ripple Payments platform, aiming to raise the bar for institutional-grade stablecoin transactions.

Despite the rollout, the news didn’t spark an immediate rally in XRP’s price.

Still, XRP continues to trade within a bullish wedge pattern that’s been in place since the start of the year.

With the price now testing the upper resistance trendline, all eyes are on whether XRP can break out and push past its cycle high.

XRP’s Bullish Pattern

The XRP price has fallen inside a descending wedge pattern since its cycle high of $3.40 on Jan. 16.

XRP’s downward movement led to a low of $1.61 on April 7, causing a breakdown from the $2.05 horizontal support area.

However, XRP bounced (green icon), validating the wedge’s support trend line and moving above the $2.05 resistance area.

Today, the XRP price trades at the wedge’s resistance trend line, aiming to break out. If it does, the next resistance will be at $2.55.

Technical indicators do not confirm whether this breakout will be successful.

The Relative Strength Index (RSI) and Moving Average Convergence/Divergence (MACD) are increasing but below their bullish thresholds at 50 and 0, respectively.

So, the daily time frame alone cannot predict whether the XRP price will break out from its bullish pattern.

Will XRP Break Out?

The wave count suggests that XRP will not break out from the wedge on the first try.

The price could be completing a five-wave decrease (red), a leading diagonal, hence its wedge shape.

If the count is accurate, the XRP price is nearing the top of wave four, after which another drop is likely.

The most likely area for the end of the correction is at $1.53, a horizontal and a Fibonacci support level.

Alternatively, a breakout from the wedge will invalidate this count. If that happens, the XRP price will have completed its correction and move to new highs.

Key Resistance Ahead

The XRP price has increased since April 7, reclaiming a previously lost horizontal support level and reaching the resistance trend line of a bullish pattern.

Despite the recovery, the wave count suggests that the breakout attempt will be unsuccessful, and XRP will create another low near $1.55.

Nevertheless, the technical analysis does not confirm the direction of the future trend, meaning an XRP breakout and breakdown are possible.