Ripple Price: XRP Drop Imminent?

What to Know:

• XRP is exhibiting significant technical weakness against both USD and BTC, with no clear signs of reversal.
• Key moving averages are acting as resistance, reinforcing the bearish trend.
• A breakdown below current support levels could trigger further declines, potentially testing lower price targets.

XRP’s recent price action paints a concerning picture for investors, as it continues to struggle against both the US dollar and Bitcoin. This persistent weakness comes amid a broader environment of regulatory uncertainty, particularly concerning Ripple’s ongoing legal battle with the SEC. For institutional investors and active traders, these technical breakdowns and regulatory headwinds warrant careful consideration.

On the USDT pair, XRP’s daily chart reveals a well-defined descending channel that has been in place since August, a classic sign of bearish momentum. The 100-day and 200-day moving averages, now significantly above the current price, are adding further downward pressure. These moving averages, widely tracked by institutions, often serve as dynamic resistance levels, confirming the prevailing trend. The failure to break above the upper trendline of the descending channel, coupled with rejection near $2.40, signals continued bearish control. This pattern is reminiscent of other assets that have struggled to regain momentum after breaking key support levels, underscoring the importance of monitoring these technical indicators.

Currently trading around $2.01, XRP is nearing a critical demand zone at $1.80. A decisive break below this level could open the floodgates toward the next high-timeframe support around $1.50, and potentially even the $1.20 zone. The Relative Strength Index (RSI), hovering near 40 without any bullish divergence, reinforces the bearish momentum. The lack of bullish divergence suggests that the selling pressure is not yet exhausted, and further declines are possible. Seasoned traders will recall similar setups in other cryptocurrencies where a breakdown of key support led to rapid and significant price drops.

Against Bitcoin, XRP’s performance is equally troubling. The breakdown from an ascending channel pattern and the subsequent failure below 2,400 sats represent a significant technical setback. The 100-day and 200-day moving averages have flipped into resistance around the 2,400 sats level, capping any upside attempts. This is a bearish signal, as these moving averages now act as a ceiling, preventing any sustained rallies.

The BTC pair’s breakdown is particularly concerning because it invalidates a previous consolidation pattern characterized by higher lows. This suggests a shift in market sentiment, with buyers losing conviction and sellers gaining control. If the downward slide continues, the next support level lies around 2,000 sats. The overall lack of strength in the chart, coupled with the absence of reversal signals, suggests that XRP may continue to underperform Bitcoin in the near term.

The current technical picture for XRP is undeniably bearish. The descending channel on the USDT pair, the breakdown from the ascending channel on the BTC pair, and the resistance from key moving averages all point to continued downward pressure. While technical analysis is not a crystal ball, these indicators provide valuable insights into the prevailing market sentiment and potential price movements.

For institutional investors, the lack of clear bullish signals and the ongoing regulatory uncertainty surrounding Ripple present significant challenges. Active traders may look for shorting opportunities or consider reducing their XRP holdings until a clear reversal pattern emerges. However, it’s crucial to remember that market conditions can change rapidly, and unexpected news or developments could trigger a sudden shift in sentiment. Prudent risk management and a disciplined approach are essential for navigating these turbulent waters.

In conclusion, XRP’s technical weakness against both USD and BTC is a cause for concern. The lack of bullish momentum, coupled with the resistance from key moving averages, suggests that further declines are possible. Investors should closely monitor the $1.80 support level on the USDT pair and the 2,000 sats support on the BTC pair. A breakdown below these levels could trigger further selling pressure and potentially lead to lower price targets. As always, it’s essential to conduct thorough research and exercise caution when investing in cryptocurrencies.

Related: Bitcoin Treasury Trend Fades in November

Source: Original article