XRP Eyes $4 as Bullish Pennant Signals Major Breakout

Key Takeaways

• XRP is consolidating between $3.01 and $3.28, forming a bullish pennant.
• Historically, this movement sends XRP’s price higher than it did in late 2024.
• If XRP clears the key resistance at $3.40, it could hit a new all-time high.

XRP is ending January as the best-performing asset among the top 10 cryptos. In the last 30 days, its price has increased by nearly 50%, surpassing the gains Solana (SOL) registered within the same period.

Amid this performance, the altcoin attempted to mark a new all-time high. But it faced rejection as soon as it hit $3.29.

However, this rejection has led to the formation of a bullish pattern. Based on this analysis, XRP’s price could hit multi-year highs if it breaks out of this pattern.

History Support XRP Incoming Surge

On the daily chart, XRP’s price has formed a bullish pennant. A bullish pennant is a pattern that indicates the continuation of a strong uptrend. It forms when the price surges higher, briefly consolidates within converging support and resistance and then resumes its rally.

As seen below, XRP formed this same pattern between Nov. 11, 2024, and Dec. 31.

The outcome of this pattern was a rally from a local low of $2.18 to $3.29 on Jan.20.

This price increase represents a 50% increase within one month. As of this writing, the token is consolidating between $3.01 and $3.28.

As the prices swing sideways, the Chaikin Money Flow (CMF) remains in positive territory, signaling strong accumulation.

The CMF tracks the capital flow into and out of an asset, helping to identify the level of accumulation and distribution.

A rising, positive CMF indicates that buying pressure exceeds selling, while a negative reading suggests heavy distribution.

With the CMF holding above zero, XRP appears to have solid buying momentum, reinforcing the potential breakout of the bullish pennant.

Should buying pressure continue to jump, then XPR price might climb above its all-time high which it last reached in January 2018.

XRP Price to New High?

Further assessment of the daily chart shows that XRP’s value remains above the Key Exponential Moving Averages (EMAs).

For most of July to November 2024, the 20 EMA (blue) and 50 EMA (yellow) traded above the altcoin’s value. Trading above the cryptocurrency’s value indicated that the trend around XRP was bearish.

However, since November, the token has held its ground against dropping below the crucial indicators.

If the cryptocurrency continues to trade above the EMA, then XRP might resume its rally within a short period. Should that be the case, the token’s first stop could be around $3.40.

Once it clears this hurdle, the next level for the altcoin to reach might be $4, which would represent a new all-time high.

However, if the token declines below the lower trendline of the pennant, this forecast might not come to pass.

Instead, the XRP price could face a correction that could take it to the 0.618 Fibonacci level at $2.25.