Ripple (XRP) price plummeted on April 19 after being rejected at a key resistance area.
Despite the decline, the volume of the wave offers hope of a possible reversal as long as the price bottoms out soon. Can XRP Restore Its Bullish Structure?
important resistance zone
XRP price has been on the rise since March 21 when it broke above the descending resistance line. A break below this line indicates that the previous correction has ended. It led to a new yearly high of $0,585 on March 29.
Initially, the price seemed to break the $0.530 resistance area. However, XRP made a long wick above and rejected it. Wicks are considered a sign of weakness. This means that buyers cannot maintain prices and sellers take over, driving prices down. A similar wick (red icon) on April 14 supports this possibility. Therefore, the $0.530 area is now acting as resistance once again.
Also, the cryptocurrency is forming a bearish engulfing candle. This is a bearish candle in which the entire previous gain is covered by the next day’s decline. This is in line with previous bearish readings on the upper long wick.
XRP/USDT daily chart | Source: TradingView
XRP Price Prediction: How Will It Recover?
Technical analysis on the short-term six-hour time frame gives a bullish forecast. The main reason for this is wavenumber. Elliott Wave Theory is a tool used by technical analysts. It looks for cyclical long-term price patterns and investor sentiment to determine the direction of a trend.
Therefore, the price currently appears to be in the fourth wave of a five-wave bullish impulse (white). This is a positive sign for the future of XRP price, suggesting that it may break the $0.525 resistance and reach $0.650.
The price action of the fourth wave will determine the direction of the future trend. Currently, the most likely prospect for a correction to be completed is a bounce off the 0.5 Fibonacci retracement support.
XRP/USDT 6-hour chart | Source: TradingView
Therefore, if the bullish XRP price prediction comes true, Ripple price could rally towards the $0.650 resistance. In addition to horizontal resistance, it is also the Fibonacci 1.61 level of the fourth wave (black). This area may act as a top due to the confluence.
However, a break below the first wave high at $0.433 (red line) will invalidate this bullish wave. In this case, XRP price could drop to the $0.37 horizontal support area.
You can see the token price here.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should do their research carefully before making a decision. We are not responsible for your investment decisions.
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