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As XRP charts its course in 2024, intriguing signs are emerging as regards a potential moving average crossover, which may be a death cross or a golden cross.
With the XRP price currently declining, the market is keeping watch on this development, aware of the consequences for XRP's price trajectory in the next few weeks and months.
A death cross happens when a cryptocurrency's short-term moving average falls below its long-term moving average, indicating a change in momentum and a possible decline. It is determined when the 50-day simple moving average (SMA) crosses beneath the 200-day SMA. The golden cross occurs in reverse and is regarded as a bullish indication.
In the case of XRP, the convergence of moving averages is raising concerns among traders and analysts, given the cryptocurrency's price outlook. The XRP price is facing selling pressure, raising the likelihood of a potential death cross.
At the time of writing, XRP was down 2.35% in the last 24 hours to $0.505, already down 19.77% in April.
Tomiwabold OlajideIn the event of a death cross, it would not be the first time such a bearish indicator has appeared; the cryptocurrency had its first death cross of the year in January. This preceded a bottoming phase for XRP's price, followed by a subsequent recovery. XRP would later reach highs of $0.748 about three months after the formation of the death cross in January.
As history may repeat itself in the realm of cryptocurrencies, traders and investors are considering the possibility of a similar situation occurring if a death cross appears again.
Some analysts consider moving average crossovers to be lagging indicators; the market may have been overbought or oversold before a golden cross or death cross appeared.
If this is the case for XRP, a subsequent rebound might be expected following the death cross, in line with the view by some analysts that the XRP price might be presently playing out a bottoming fractal.
Arman Shirinyan
Alex Dovbnya
Dan Burgin
Vladislav Sopov