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The recent attempt by XRP to recover has encountered resistance and tumbled back down to the point of reset. The asset recovered the $1.20 area after rising from local lows around $1.05, but buyers have once again been unable to break through the cluster of resistance levels that has capped every rally since May.
XRP fails the first bullrun test
After being rejected close to the 20-day EMA, the chart shows XRP trading at about $1.18, though it is currently at about $1.22. For bulls, this level has emerged as the first significant challenge. More significantly, XRP is still below the previous support range of $1.30 to $1.35, which has now turned into a major resistance zone.
It is not totally shocking that it was rejected. Many traders who were stuck during the decline are probably using rallies as an opportunity to sell their positions after the breakdown below $1.30 earlier this month. Every time XRP gets close to resistance, that generates steady selling pressure.
The situation is not wholly pessimistic despite the rejection. In comparison to the recent capitulation event, XRP successfully defended the psychological $1.00 area and formed a higher low. Additionally, volume rose during the recovery, suggesting that buyers are still present in the market. Momentum indicators are also steadily improving. The RSI is getting closer to the neutral zone after rising out of oversold territory, indicating that the selloff's panic phase is over. Nevertheless, momentum is still insufficient to confirm a reversal of the trend.
Most important resistance to break
The crucial level to keep an eye on going forward is still $1.22. The $1.30-$1.35 resistance cluster would probably become accessible with a successful close above the 20-day EMA. For XRP bulls, that area is the most crucial battlefield. Regaining it would greatly improve the medium-term outlook and could lead to a move toward $1.50.
On the downside, XRP may return to support around $1.10 and ultimately the $1.00 area if the current recovery is not sustained. Even though the market has stabilized, lower highs and lower lows still make up the larger structure.
XRP seems to be torn between consolidating and recovering at the moment. Although buyers have demonstrated their ability to hold the $1.00 area, each rally is still susceptible to another rejection until the asset breaks above its key resistance levels. Whether XRP is building a sustainable base or is simply holding off before another decline should become clear in the coming weeks.
U.Today Editorial Team
Dan Burgin
