Ripple (XRP) Halts Following Market Turmoil: Is Another Downtrend or a Bullish Trend Ahead?

Ripple (XRP) experienced a 6% drop in value within the last 24 hours, prompting traders to consider if the downturn is concluding or if further declines are imminent.

The recent data aligns with the Elliott Wave Theory (EWT), indicating that after significant movements, a Wave 4 stabilization occurs, potentially signaling a final impulse wave ahead.

Is the Market Ready for a Turnaround?

Historically, after significant moves during a Wave 3, markets typically do not reverse abruptly. Analyst CasiTrades explains that the pattern typically includes one final drop, or Wave 5, prior to a clear trend reversal. The current pricing suggests support for this theory, as XRP has struggled to surpass the critical resistance level of $2.82, even with signs of market recovery.

Without a strong breakout, it appears that one more corrective wave is likely necessary to alleviate selling pressures before a shift towards bullish sentiment can occur.

Cross-exchange data is showing significant inconsistencies. Various trading pairs are reporting wildly different lows, ranging from below $1 to significantly higher values. For instance, on Binance USD, XRP’s price briefly fell to $0.77, demonstrating a dramatic 72% decrease from its recent peaks, which also saw it breach the .786 Fibonacci retracement.

While revisiting this extreme seems unlikely, analysts caution that a retest of levels like the .618 retracement around $1.46, or the “golden pocket” at around $1.35, is within the realm of possibility in the next downturn. These price points correlate with multiple technical indicators, which include Wave 5 extensions and macro retracements, marking them as critical accumulation zones and potential setups for a strong reversal.

The chaotic market conditions might present a silver lining for XRP traders. This recent turmoil may have adjusted the broader Elliott Wave count from a shallow Wave 4 to a deeper macro Wave 2, potentially setting the stage for a substantial upward movement that could drive XRP towards values between $6.50 and $10.00.

Upcoming Testing of the $2 Mark

Crypto analyst Ali Martinez has recently highlighted concerns regarding XRP, predicting that it “looks like it wants to visit $2.” He refers to XRP’s UTXO Realized Price Distribution (URPD) to pinpoint $2.10 as a possible support level if the asset faces another decline. Conversely, an upward shift could see XRP find immediate support around $2.80, which may enable it to regain momentum towards $3.

Related Articles: