Trade Recommendation: Ripple
Ripple (XRP/USD) has been the strongest big cap cryptocurrency lately. Even if Bitcoin Cash (BCH/USD) made some big moves last week, Ripple kept in pace as it made breakouts of its own. On November 6, 2018, XRP/USD took out resistance of $0.50 and climbed as high as $0.562.
This was an important breach as $0.50 used to be the market’s parabolic support. Ripple skyrocketed on December 14, 2017, when it went above $0.50. It was flipped into a key resistance on June 22, 2018, during the height of the bear market. XRP/USD has been trying ever since to take it back for good. Today might be the day it does so.
Technical analysis shows that Ripple is currently retesting support of $0.50. We believe that bulls will hold for the following reasons.
First and most important, the 200-day moving average (MA) just crawled below the daily candle. This is a huge development. Moving averages act as supports or resistances depending on whether they’re below or above the candle. So instead of looking up and finding strong resistance in the 200-day MA, it is under the daily candle, giving it a very nice boost.
In addition, $0.50 is a key psychological level. If the market is above it, it becomes a demand zone. On the other hand, if Ripple is below it, it becomes a supply area. Right now, Ripple is around that level.
Almost no one’s selling at these levels because participants know it is a buy zone. With no one selling, positions are scarce, hence the low volume.
The strategy is to buy at the current price of just under $0.50. If Ripple successfully completes the retest, the market will likely break out of the triangle and rally to our target of $0.70
The process may take a month.
Daily Chart of Ripple/US Dollar on Kraken
As of this writing, the Ripple/US Dollar pair is trading at $0.49475 on Kraken.
Summary of Strategy
Buy: Current price of $0.49554.
Disclaimer: The writer 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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