With Bitcoin gradually inching closer towards the $100,000 milestone, XRP finally finds a strong bullish ground. With an intraday recovery of 10.96%, XRP aims for a recovery run.
Putting the local support trendline to the test, will the XRP price reclaim the $2.50 psychological mark? Let’s find out.
XRP Faces Key Resistance and Support Levels
In the daily price chart, the XRP price trend reveals an intense bearish pullback. The downfall in XRP comes from the recent swing high of $3.29, testing the local support trendline near $2.38.
This accounts for a price drop of nearly 30% over the past three weeks. During the pullback, XRP lost support at the 50-day EMA line and the 23.60% Fibonacci level at $2.58. The failure to hold these crucial levels fueled bearish sentiment, leading to increased short positions in the derivatives market.
Currently, XRP remains under the $2.50 psychological mark, but the bullish dominance sustains over the local support trendline. The XRP price action also reveals a rising broadening wedge at play. A breakout above the wedge pattern could invalidate bearish concerns and push the price toward higher resistance levels.
Can XRP Breakout to a New All-Time High?
This generally hints at a bullish failure to hold the uptrend, resulting in a sharp correction. However, the recent uptick in the RSI line projects a potential comeback for XRP. A bullish divergence in RSI often suggests growing buying momentum, which could trigger a short-term breakout.
As per the trend-based Fibonacci levels, the recovery run in XRP will likely challenge the overhead resistance trendline close to the 78.60% Fibonacci level at $3.80. This will result in a new all-time high for XRP and increase the chances of a breakout rally. If trading volume picks up, the rally could accelerate, reinforcing bullish sentiment.
However, the recent pullback has resulted in an uptick in the dynamic average line, making XRP mildly bearish. Hence, on the flip side, if the buyers fail to sustain dominance over the local support trendline, the pullback in XRP could retest the $2 psychological mark, breaking under the 100-day EMA at $2.17.
In a highly bearish case, the final support for XRP remains the 200-day EMA at $1.62. A break below this level could trigger panic selling, pushing XRP into a deeper correction phase.
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