Ripple Price Analysis Confirms a Reversal
Ripple (XRP) is currently leading gains amongst the top 10 cryptocurrencies. As of 11:30 AM UTC, September 19th, Ripple price was up 12.39% (a 24-hour gain according to CoinMarketCap data), with Bitcoin (+0.85%), Ethereum (+4.61%), Bitcoin Cash (+1.51%), EOS (+3.26%), Stellar (+2.82%), and Litecoin (+2.24%). Currently, both fundamental and technical factors confirm a trend reversal and support an upward price trajectory for Ripple. With the price down 90% from its January highs, this may just be the perfect time to enter XRP.
On the fundamental side, the September 13th announcement about the National Commercial Bank (NCB) of Saudi Arabia joining RippleNet, is what could be driving more interest and trading volume for XRP recently. The Kingdom of Saudi Arabia is clearly one of the largest sources of remittance in the world, with over 10 million foreign workers. News of the NCB joining RippleNet, is expected to give a big boost to XRP’s reach and use, worldwide.
On the technical side, Ripple price analysis reveals clear signals in favor of the bulls. In our recent post, we confirmed an XRP/USD pennant breakout indicating bulls taking charge of Ripple’s native asset – XRP. Our latest observation on Ripple’s price movement, bolsters our belief of the impending reversal in Ripple XRP finally taking form.
Double Bottom Pattern Confirmed – Trendline Breakout Calling to the Bulls
Our Ripple price analysis reveals the completion of a double bottom pattern. XRP broke through its second trend line on September 18th. It’s now trading comfortably above its 14-day simple moving average (14-SMA) while getting closer to its 50-SMA. A double bottom is a technical analysis charting pattern that describes a change in trend and a momentum reversal from prior leading price action. The double bottom looks like the letter “W” – as can be seen in the chart above. The twice-touched low is considered a support level ($0.26 currently for XRP). Since May this year, Ripple’s price has been declining, amid bearish sentiment and limited momentum. The completion of the double bottom pattern, along with the XRP price breaking out above its downward sloping trend line (the second one), indicates a reversal in trend for Ripple. XRP now seems to be calling out to the bulls. Immediate resistance could be met at $0.36.
The Risk Averse Could Wait
However, a word of caution here for those who are risk-averse. While the breakout and the double bottom are good indicators of a trend reversal, investors must also heed the warnings of the recent past. In mid-July too, we saw XRP breaking out from its continuing downtrend, which had been continuing since May (marked by the first trendline in the chart above). The July breakout was, however, shortlived as it wasn’t accompanied by sufficient trading volumes or momentum.
The current breakout is expected to be different since it is supported by enough buying volume. However, if we go back to the basics to look for factors that assure a reversal in trend, we fail to find evidence in swing analysis just yet. As of now, XRP hasn’t yet confirmed higher swing highs and higher swing lows.
So, while the breakout does trigger the possibility of a reversal, prudent traders and investors may want to wait for additional affirmations from other technical signals. The relative strength index (RSI) is trending upwards and is currently around the 55 level. If the current uptake in trading volume persists, we may see more momentum building up, adding a point in the bulls’ favor.
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