Technical Analysis and Market Entry: XRP/USD Produces Double Bottom, Big Bull Neckline Break Now Possible
- XRP/USD has broken out of critical trend changing price ranges, leaving the door open to further buying pressure.
- Price action is playing out to a possible technical double bottom formation via the daily.
XRP/USD: Recent Price Behaviour
Life has kicked back into the bulls, after such a dim outlook for XRP since the back-end of June. The price is now running towards its fifth consecutive session in the green and heading for another potential positive weekly close. XRP has gained as much as 16% within this period, moving back to the highest levels in over two weeks.
The bullish momentum comes after XRP smashed through a barrier of resistance, which had been containing upside. XRP/USD was moving within a narrowing trading range, something that was observed from mid-August. The bearish trend was very dominating, which saw any near-term rallies being sold in no time.
There was a massive bout of selling pressure between 19-24 September, which saw the price falling some 30%. XRP/USD dropped down from the heights of $0.3250 to depressed levels of around $0.2200. It was being forced to trade at the lowest levels that had been seen since December 2017.
XRP/USD had already attempted to bottom out on 15 August down at $0.2245, but as mentioned above the retest came into play on 24 September. The touch of this territory saw another decent bounce, which is still carrying XRP further north. Should the double bottom play out to the textbook, then it would see a change of the neckline up at around $0.3270.
Two Critical Range Breakouts
It is evident to see the progress that is being made by the bulls, as they break through critical narrow daily ranges. The first seen between 25-29 September, the price action to the upside at $0.2480, with support at $0.2330. A surge of momentum came into play on 30 September, pushing to the north through this noted range. Most recently, between 1-6 October, the price was capped at $0.2580 and supported at $0.2450. The exacerbated breakout witnessed in the session of 7 October.
Given the recent technical breakout, eyes are on further moves north if the bulls can break down a large critical barrier nearby. In terms of targets to the upside, it would be desirable to see a daily breakout and retest of resistance at $0.2850. Upon successful completion of this, completion of the double bottom structure would be watched; the neckline is tracking at $0.3270.
Once the price then breaks and retests the $0.3270 area, a return back up to the psychological $0.4000 will be eyed. Entry to be around $0.2850, once the above-described play comes into action. Stops to be then backed around $0.2700, leaving enough breathing room below.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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