A substantial Ripple rally fizzled as the asset’s value fell as much as 12% from its weekly high.
The XRP-to-USD exchange rate (XRP/USD) dropped to an intraday low at 0.3003 this Friday. Earlier yesterday, the pair had established a new weekly high at 0.3429 owing to global banking giant Swift’s announcement of integrating R3 Corda, which supports XRP as its native token. Traders treated the event as the sign of the next bull wave. The price surged impressively but found its upside momentum capped on a higher high formation towards $0.3429. A correction ensued and spent its Thursday maximizing.
At 0900 UTC, the XRP/USD was trading at 0.3043, up 1.31% from its intraday low. According to CoinMarketCap.com, the pair had fallen by 3.43% on a 24-hour adjusted timeframe.
The abrupt trend reversal in the XRP market indicates that the trader did not intend to hold the token. The spot market took cues from events that unfolded at the Paris Fintech Forum. There, Ripple CEO Brad Garlinghouse announced that they were open to partner with Swift – a banking network that interlinks more than 11,000 financial institutions – in their blockchain trials. After the price, the XRP/USD rate rose more than 9% in just three hours – as CCN.com reported.
It could have appeared organic had the price sustained its gains. On January 31, the XRP market posted three consecutive selling sessions on an hourly basis. Between 0700 UTC and 1000 UTC, the XRP/USD rate had fallen from 0.3329 to 0.3103. Meanwhile, traders exited their short positions that translated into a brief upside correction. The pair again switched sides after it tested 0.3206 for a breakout, forming three long red candlesticks.
From the technical point of view, XRP is hinting a major sell-off round in the near-term. The chart above is forming a death cross – it appears when a short-term moving average crosses above a long-term moving average. Here also, one can see a 50-period EMA slipping beneath a 200-period EMA. An increase in volume typically confirms the long-term impacts of a death cross. As of now, XRP’s daily amounts are modest compared to its recent figures.
A rising trendline, meanwhile, is capping the XRP/USD rate from forming any more lower lows. The support area, in a best-case scenario, could allow the pair to sustain its upside action. However, if broken, the XRP/USD rate could fall toward its next downside target area, defined between 0.2898 and 0.2853.
XRP should establish an interim bullish bias if it breaks above its 200-period moving average. However, the asset would remain inside a giant bearish sentiment.
Last modified: September 23, 2020 12:23 PM