XRP Eyes Rally to $3.40 as Bear Pattern Breaks

XRP is showing strong signs of a potential bullish breakout, with technical signals suggesting it may surge to $3.40 after the collapse of a key bearish formation. The focus cryptocurrency, XRP, which powers Ripple’s cross-border payment infrastructure, has recently shrugged off downward momentum and is now on a notable upward trajectory.

From December through April, XRP had been forming a textbook head-and-shoulders pattern—a well-known chart formation that often signifies a transition from a bullish to a bearish trend. In early April, the neckline of this pattern gave way as XRP fell below the critical $2 level, tumbling quickly to a low near $1.60. This breakdown led many traders and analysts to predict a deep retracement, with targets as low as $1.20.

However, in a dramatic twist akin to a basketball player faking a jump shot to throw off the defender, XRP reversed sharply. By bouncing back above $2 in a short span of time, the token invalidated the bearish pattern. The “failed breakdown” is often seen as a strong contrarian signal, where sellers are caught off guard, propelling fresh buying interest.

XRP has since continued its ascent, rising past $2.50—erasing much of the previous downtrend that started from January’s peak of $3.40. This price move not only restored bullish confidence but also gave XRP investors hope that a retest—and possible breakout—above the prior high is within reach.

This optimistic outlook is reinforced by XRP’s position relative to its 200-day simple moving average (SMA). The token has remained comfortably above this long-term support line, even during April’s broad crypto market selloff that saw Bitcoin dip below $75,000. Maintaining strength above the 200-day SMA is typically considered a strong indication of long-term uptrend viability.

CoinDesk’s market insights bot also noted that the breakout above the $2.40 resistance level came with significantly increased volume. High-volume breakouts are often seen as more credible, and in this case, it resulted in the formation of an ascending channel – another bullish technical pattern. The bot projected a potential short-term target of $2.85 by early June, while broader forecasts from market analysts range as high as $15 in the long term.

Several fundamental factors are also fanning the flames of bullish sentiment surrounding XRP. Ripple’s favorable outcomes in its legal battles with the U.S. Securities and Exchange Commission (SEC) have removed major regulatory overhang, allowing the token to rally on newfound investor confidence. Additionally, a post-election political climate more favorable to digital assets—fueled by the return of a crypto-supportive Trump administration—is contributing to the wave of optimism.

The combination of technical resilience, improving trading volume, bullish patterns, and favorable macro developments bolsters the view that XRP could be on course to reclaim and potentially surpass its January highs.

For a broader look at how XRP and other major cryptocurrencies are performing relative to key moving averages, see this market overview.

Related: Expert Advice: Sell XRP If You’re Confused

Additionally, the original forecasted downtrend from earlier this year can be revisited in this prior technical analysis.