XRP price may be nearing the end of a short-term correction. Whether it bounces off the support line of the current pattern will determine whether the correction is complete.
With no recent news about the lawsuit between Ripple and the SEC, XRP lost its horizontal support.However, Ripple Labs has tweet Their cryptocurrency and blockchain predictions for 2023. Among them, they are optimistic about NFT, central bank digital currency (CBDC), and investment in cryptocurrencies by financial institutions.
triangle pattern
XRP price has been trading inside a symmetrical triangle since June 2022. Both the resistance and support lines have been verified many times. Prices recently created a large bullish hammer candle on January 2 (black symbol), kicking off the current uptrend.
Despite rising and breaking above the $0.380 area, XRP price was unable to break out of the triangle. Instead, it has been rejected (red circle) for almost a month. Now, the price is again trading below the $0.380 area. Also, this caused the daily RSI to drop below 50, another bearish sign. This area is no longer considered a significant support/resistance zone as the cryptocurrency has moved above and below this level several times.
Whether Ripple price breaks out or falls below the triangle can determine the direction of future price action. A breakout could take XRP to $0.505, while a breakout could take it to 2021 lows of $0.30.
XRP/USDT daily chart | Source: TradingView
XRP May Complete Correction Soon
Technical analysis on the three-hour time frame supports the possibility of a price reversal soon. There are two main reasons for this.
First, XRP price is trading at the confluence of support at $0.367. Support is created by the 0.5 Fibonacci retracement support and the descending parallel channel support line.
Second, XRP price may be nearing the end of an ABC correction, where the ratio of waves A:C is 1:1.
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However, for the wave to remain valid, the XRP price must reverse the trend as quickly as possible. A decisive break of the channel and 0.618 Fibonacci Retracement support would also trigger a breakout of the long-term triangle. Therefore, it will invalidate the bullish forecast and could take XRP to $0.3.
XRP/USDT 3-hour chart | Source: TradingView
In conclusion, the most likely XRP price predictions indicate that the downtrend will reverse soon and XRP will make another attempt to break out of the current triangle. However, a decisive close below $0.360 would invalidate this assumption and could lead to a drop to $0.3.
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