Trade Recommendation: Ripple (XRP)

Ripple

Ripple has been in a downtrend for all of 2019. The number three cryptocurrency has lost almost 67% of its value year-to-date. However, bulls have the chance to step up and finally make their presence felt. It’s either they build a solid support at 0.00003 now or its another 33% tumble for the cryptocurrency before the next support at 0.00002.

Technical analysis shows that XRP/BTC is showing signs of trend reversal. We have this view for several reasons.

First, the daily chart shows that bears successfully breached support of 0.00003 on July 11th. However, bulls responded and brought the market above the support on July 16th.

This is an encouraging signal as 0.00003 is a critical level for Ripple. Back in December 2017, the altcoin breached this resistance and converted it into support. After doing that, Ripple skyrocketed to an all-time high of 0.00022968 in January 2018. Thus, the quick recovery of the support tells us that the market may bottom out at this level.

This bias is strongly affirmed by the daily RSI. The technical indicator is flashing the longest bullish divergence of Ripple’s history on Binance. Even though the price continues to depreciate, the bullish divergence suggests that bulls are gaining significant momentum. Also, both the weekly and daily RSIs are flailing oversold readings. At the very least, we can expect a bounce under such conditions.

The strategy is to buy as close to 0.00003 support as possible. If XRP/BTC manages to stay above this support, the market will likely generate the momentum to rally to our initial target of 0.000038. Take that out and 0.000046 is next.

The process may take less than a month.

Daily Chart of Ripple/Bitcoin on Binance

XRP chart
As of this writing, the Ripple/Bitcoin pair is trading at 0.00003125 on Binance.

Summary of Strategy

Buy: As close to 0.00003 as possible.
Target: 0.000036 and 0.000046.
Stop: 0.0000285

 

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.
Featured image courtesy of Shutterstock.

Kiril is a CFA Charterholder and financial professional with 5+ years of experience in financial writing, analysis and product ownership. He has passed all three CFA exams on first attempt and has a bachelor's degree with a specialty in finance. Kiril’s current focus is on cryptocurrencies and funds, as he does his own crypto research and is a Product Manager at Mitre Media. He also has his personal website, InvestorAcademy.org where he teaches people about the basics of investing. His ultimate goal is to help people with limited knowledge of finance and investments to create investment portfolios easily, and in line with their unique circumstances.