*My Thoughts & Technical Analysis on the XRP (Ripple) Cryptocurrency*
Happy Sunday everyone and I hope you had a good weekend. I don’t normally do blog posts on the weekend because I am usually busy playing golf or drinking wine but I thought I would do something different today. My normal markets that I trade are closed from Friday evening but as you may or may not know, the cryptocurrency markets run 24/7 and this is what I want to talk about today. So sit back, grab a glass of wine and enjoy my technical analysis on XRP.
Firstly, I would like to point out that I do hold many XRP coins as a long term investment. I do feel that in the long term (1 year – 5 years) they will increase in value and the Ripple payment network does hold value and purpose in our society. High speed, international payments are something we all need and would benefit from.
That being said, a long term bullish bias does not mean that there are many intraday trading opportunities available going against this view. I will show you my current near term outlook on XRP along with what I think price will do going forward and how I plan to trade it on multiple timeframes. Let’s start with the daily timeframe chart and the key price zones I am taking note of.
At first glance, the XRP daily chart looks relatively flat and price action could be considered “stagnant” but don’t let that fool you. If you zoom in on this timeframe or change to the 4hr chart you will see some significant sized waves in price which could have proved to be very profitable if traded correctly.
I have used this timeframe chart to first show you the 2 key zones I have marked on which are the $0.60 resistance zone and the $0.30 price support zone. These 2 have seen significant price reactions in recent months and if price is to break these levels going forward then we should see some more big moves on XRP. I would also like you to take note of the weekly/daily Fibonacci Retracement levels I have marked on which will show you why I have my final bearish target price set at $0.21 before any big moves to the upside may take place.
Now let’s drop to the 4hr timeframe chart and look at the intraday moves that XRP is making.
On the 4hr timeframe chart I have first used the line chart to accurately place my trendlines in order to determine the current patterns formed on this cryptocurrency. We have a clear wedge breakout pattern formed with the 4hr chart showing a bearish trend with lower highs and lows. This is why I am looking for only short position entries on this crypto until that weekly fibonacci pattern is completed at the $0.21 price level.
If you aren’t aware of how to use trendlines and place them on charts then you should check out my previous blog post via the link below. It will really help you with your technical analysis.
Now let’s move back to the candlestick price chart and look at the extra confluences for why short positions should have a high probability of being profitable.
I have now added the Fibonacci retracement tool to the most recent 4hr swing high and swing low to produce the retracement levels that should provide resistance on the next pullback. The 0.618 retracement level aligns perfectly with the broken lower TL and the descending TL that joins the previous high and lower high. This zone at around 1.3250 therefore provides a higher probability of resistance and is my favoured zone for entering short positions.
Remember, I am a huge fan of keeping it simple and you should to. As it stands we have the weekly/daily timeframe showing that a lower high should be made at some point and now the 4hr timeframe is also showing a bearish trend. Therefore, I am looking to go with the current trends and short on the lower highs.
You can keep track of my XRP analysis via my TradingView profile which can be found via the link below: