XRP Price Waves Signal New Targets

What to Know:

• Bitcoin’s recent rally shows signs of a potential fakeout, struggling to overcome key resistance levels, indicating a relief rally within a larger downtrend.
• Shiba Inu is nearing a potential turning point, making its third attempt to break through the 100-day EMA, suggesting weakening resistance and possible bullish momentum if successful.
• XRP’s current market structure is characterized by a series of three local price waves within a bearish framework, with each wave facing strong resistance and showing signs of waning bullish interest.

Bitcoin’s recent price action has captured the attention of institutional investors closely monitoring the digital asset’s ability to sustain upward momentum amidst a complex macro and regulatory landscape. While the initial surge appeared promising, a deeper analysis reveals underlying weaknesses that suggest a potential fakeout rather than a true trend reversal. Understanding these nuances is crucial for fund managers and traders navigating the volatile crypto markets.

Bitcoin’s Stalled Recovery

Bitcoin’s attempt to breach the 100 and 200 Exponential Moving Averages (EMAs) proved unsuccessful, with the price stalling almost immediately upon encountering this heavy technical resistance. This contrasts with genuine trend reversals, which typically either break through such levels decisively or consolidate before continuing upward. The rapid increase in volume followed by a quick dry-up suggests short covering and late longs being baited in, rather than sustained spot accumulation. This pattern is reminiscent of previous false breakouts that trapped unsuspecting investors.

The 200 EMA is rolling over, indicating a weakening long-term trend, which overshadows any temporary price increases. As long as Bitcoin remains below this threshold, breakout attempts should be viewed with caution. The current price action aligns more with a relief rally within a larger downtrend, a pattern observed in previous bear markets. Institutional investors should remain skeptical of sustained upward movement without a confirmed break above key resistance levels.

Momentum indicators, such as the Relative Strength Index (RSI), support this cautious outlook. While the RSI moved into the upper-neutral range, it failed to reach levels typically associated with significant trend reversals. Higher time frames reveal a mechanical bounce following oversold conditions, rather than a true bullish divergence. This type of move resets indicators without altering the underlying market structure, a common occurrence during corrective phases.

Shiba Inu’s Approaching Turning Point

Shiba Inu (SHIB) is quietly approaching a critical juncture as it makes its third attempt to break through the 100-day EMA. This repeated testing of resistance is significant, as markets rarely break through such levels on the first attempt. Each subsequent attempt weakens the resistance, increasing the likelihood of a breakout. The stabilization of SHIB’s price after a protracted decline indicates a reduction in selling pressure.

After printing a local bottom and bouncing sharply, SHIB has cooled off into a shallow consolidation, suggesting a significant reduction in selling pressure. The current compression slightly below the 100 EMA, while holding above short-term moving averages, often precedes a directional move. This setup is similar to patterns seen before previous breakout attempts in other altcoins, where reduced volatility and consistent buying pressure paved the way for significant gains.

If SHIB can recover the 100 EMA and hold above it, even briefly, the technical picture would shift significantly. Such a move would invalidate the most recent lower-high structure, potentially triggering a rotation toward the next resistance zone. However, a third failure at the 100 EMA would likely keep SHIB range-bound and reinforce the overall bearish trend, requiring patience and limiting upside potential.

XRP’s Bearish Wave Structure

XRP’s current market structure is best described as a series of three local price waves developing within a larger bearish framework. Each wave has formed within a downward-sloping channel and under declining moving averages, limiting expectations for a clean recovery. The market’s response has been corrective, with each rally followed by a rollover, indicating persistent selling pressure.

The first wave saw XRP lose the 100 EMA and fail to recover it, signaling a breakdown from earlier support. This established a pattern of upside attempts lacking volume and follow-through, with sellers remaining in control. The second wave was even less powerful, with XRP recovering to a lower high, indicating waning bullish interest. Momentum indicators reflected relief rather than accumulation.

Currently, XRP is moving into its third local wave, structurally attempting to establish a base after a prolonged decline. However, it faces significant overhead resistance, with the 50 and 100 EMAs remaining above the price and sloping downward. This wave is technically a corrective attempt within a bearish trend, making a sustained recovery less likely unless XRP can break the descending channel and recover key moving averages.

In summary, while Bitcoin’s recent rally appears fragile, Shiba Inu shows potential for a breakout, and XRP remains entrenched in a bearish pattern. These assets reflect the broader crypto market’s struggle to establish a clear direction amid macro uncertainty and regulatory headwinds. Institutional investors must remain vigilant, employing disciplined risk management strategies and focusing on assets with strong fundamentals and clear technical signals.

Related: Stablecoin Funding Available 24/7 on Interactive Brokers

Source: Original article