Technical Analysis and Market Entry: XRP/USD – The Bulls Have Awoken, Sights on $0.5000 Return
- XRP is running at its fourth consecutive session in the green, gaining as much as 13%.
- XRP/USD bulls are making an encouraging move towards a significant breakout from a pennant pattern structure.
XRP/USD: Recent Price Behavior
The XRP bulls are back, as momentum to the upside regathers some pace with the price running towards its fourth consecutive session in the green. XRP/USD has gained as much as 13% within the noted period, pushing to the highest level seen in two weeks. It is the best run of gains seen since the back end of May, after taking some time to consolidate.
2019 Recovery: Bulls are Back for Good
The price has been on a solid path to recovery since the beginning of 2019. XRP/USD is up as much as 70% from the lows of $0.2700, where a huge area of demand assisted the price. XRP bulls were able to turn the buying pressure up a notch, after breaking above a long-running descending trend line. The resistance had been in play since September 2018, forcing several devastating rejections in November 2018, April and May 2019.
In the middle of May, XRP/USD made an aggressive breakout and closure above via the weekly. The price jumped around 53% to the highest levels since November 2018. Given the significance of the trend line in how long it had capped the upside, this was a huge breakthrough. It has paved the way for the market bulls to run the price further to the north.
Since the sharp break above the noted trend line, price action has very much been moving within consolidation mode. The price has been narrowing for some four weeks now; however, there are growing signs of an extended move to the upside. During the noted period, XRP/USD has formed a bullish pennant pattern structure.
The pole of the technical formation is the large bullish candlestick of the week commencing 13th May. The upper acting trend line of the flag can be seen tracking around $0.4350; if the bulls can push for a daily closure above, then they could be free. XRP/USD has yet to close above.
Given the increasing buying pressure, a long position is attractive. The confirmation would be as earlier noted – a daily closure above the pennant. XRP’s bulls will then have a task of breaking down a chunky area of supply, which runs from the $0.4400-$0.4800 range. In terms of targets; $0.4750, $0.5000 and then $0.5500 are eyed. Stops would be placed just below the upper trend line of the pattern, once the area proves as new support, $0.4180.
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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