The XRP bulls are working tirelessly to maintain the critical $0.5 level, following a slight bounce back from the immediate support level at $0.56. Like its counterparts in the crypto space, XRP is grappling with diminished liquidity, a byproduct of the evident disinterest from investors who have lately opted for a more passive stance.
While XRP is marginally in the green, its price movement over the past 24 hours has remained somewhat stagnant. With trading volumes just scraping the $1 million mark, its market capitalization is stable at $26.8 billion, surpassing USD Coin (USDC) at $25.6 billion.
But is XRP setting the stage for a 10% breakout?
Recent trends indicate an inverse head and shoulders (H&S) bottom pattern forming for XRP. Typically emerging during a downtrend, this reversal pattern signifies a potential shift from a downtrend to an uptrend. However, this pattern heavily relies on trading volumes to truly take effect.
Merely identifying the inverse H&S doesn’t shift the market perspective. Traders should ensure certain criteria are met before capitalizing on this pattern. For one, XRP’s price must challenge the neckline resistance, which should coincide with a volume surge to avoid falling into a potential bull trap.
The On-Balance Volume (OBV) is pivotal in this scenario. For a genuine breakout at the $0.51 level, the OBV should aggressively lean toward the overbought zone to maintain the emerging uptrend.
Before tackling the neckline resistance, the combined resistance at $0.5054, shaped by the 50-day Exponential Moving Average (EMA) and the 100-day EMA, must be breached.
The Moving Average Convergence Divergence (MACD) suggests a bullish dominance. However, for the uptrend to solidify the inverse H&S pattern, traders on the fence should rally behind the XRP breakout.
For those keen on capitalizing on this movement, buy orders might best be placed slightly over the $0.51 breakout point, with a safeguard stop loss set at the $0.5054 confluence level. The breakout goal, deduced from the neckline to the head of the pattern and projected above the breakout point, lands at $0.56.
Disclaimer: The information provided is not trading advice, Bitcoinworld.co.in holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.