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XRP's weekend rally might have looked good at first, but the price action is already telling a different story, and the Bollinger Bands are showing it. After starting at $2.41 in early Monday trading, XRP hit a wall, dropping almost 7% in the same day, as visible on the TradingView chart. It also started to lose steam right when it reached the upper boundary of the indicator's range.
The fourth biggest cryptocurrency is still trading below the midline of the Bollinger Bands on the weekly time frame, currently at $2.4254. Until XRP closes decisively above this level, the market will see the bounce as a counter-trend move inside a still-valid downward channel that began back in late October.
And that lower band? It is currently sitting at $1.6679, having already been visited once last month.
Another angle for XRP
The daily chart backs up the warning. After a strong three-day increase that brought XRP up from $1.90 to $2.41, buyers have not been able to keep the upward trend going. The middle band on the daily chart sits near $1.96 and will probably become the magnet if the price keeps sliding.
Now that the upper band is rejecting attempts above $2.3, it is much more likely that we will see another test of sub-$2 liquidity zones.
Short-term bulls might get another shot, but not at the highs they were hoping for.
If the market stays volatile and the upper band keeps rejecting, it is not just possible, it is likely that the price of XRP will drop below $2. That is just how Bollinger Band pullbacks usually happen during unresolved weekly consolidations.
Gamza Khanzadaev
Tomiwabold Olajide
Arman Shirinyan
Godfrey Benjamin