XRP price poised for a 30% surge after breaking key resistance area

In the Brief:

  • XRP/USD pair aims to gain more in Q2 with a 60% rise in Q1.
  • XRP broke above trendline in late March and is consolidating due to bull pennant.
  • Breaking past upper trendline will set new bullish target of $0.65.
  • XRP's price rise corresponds with whale accumulation.
  • XRP's bullish outlook depends on future Ripple vs.
  • SEC win, though "sell the news" scenario is possible.

3 - 5 minute read

The XRP/USD pair is in focus as it eyes more gains in the second quarter, primarily due to a classic bullish continuation pattern. XRP has risen by an impressive 60% in the first quarter of 2023, helped by rising speculation over Ripple’s legal win versus the U.S. Securities and Exchange Commission (SEC) and broader bullish sentiment in the cryptocurrency market.

Late March, XRP broke above its multi-month ascending trendline resistance, averting a potential 35% correction. The rebound reached $0.58 on March 29, its highest level since May 2022. Now, XRP has been consolidating sideways in what appears to be a bull pennant. This bullish continuation pattern forms when the price consolidates inside a symmetrical triangle after undergoing a strong rally.

XRPUSD Price Source: Tradingview

A bull pennant resolves after the price breaks above its upper trendline while accompanying a rise in trading volumes. The pattern’s breakout target is obtained by adding the height of the previous uptrend (flagpole) to the breakout point, giving a bullish target of $0.65 in Q2 for XRP price, up around 30% from current levels. Conversely, a decisive close below the pennant’s lower trendline risks invalidating the bullish setup and increasing XRP’s probability of testing its 50-day exponential moving average (50-day EMA; the red wave) near $0.44 as its next downside target.

The YTD gains in XRP price coincide with a rise in whale accumulation, according to data tracked by Santiment. For instance, the supply of XRP held by most whale address cohorts — be it 1,000-10,000 XRP, or 100 million-1 billion XRP — has increased alongside its 40% gains in 2023 despite reports of some whales dumping XRP worth around $35 million. Meanwhile, a weakening U.S. dollar has boosted risk-on assets across the board, including Bitcoin (BTC), whose correlation with XRP has largely remained in lockstep on a daily timeframe this year.

The bullish scenario for XRP remains dependent on a Ripple win against the SEC in the near term while a “sell the news” scenario should also not be ruled out. It is important for traders to conduct their own research before making a decision as every investment and trading move involves risk.

Disclaimer: The content in this article is provided for informational purposes only and should not be considered as financial or trading advice. We are not financial advisors, and trading carries high risk. Always consult a professional financial advisor before making any investment decisions.

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