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XRP's recent price behavior is alarming the market. The daily chart shows a gradual erratic decline from the most recent local peak close to $3.70, with the price currently circling $3.12.
Unstructured movement
This does not neatly fit into any textbook structure. The way it is dropping is the issue, not just the drop itself. No flush candle panic selling or significant liquidation spike are present. Throughout this correction, volume has continuously decreased, indicating that neither bulls nor bears are very convinced.
Neither a clean consolidation nor a sharp pullback are present. Rather, it appears to be a gradual loss of momentum without any obvious support yet. Pricing behavior like this can be risky. A market is susceptible to unexpected breakdowns when it loses momentum and begins to decline on decreasing volume, particularly if retail holders' confidence starts to wane.
XRP's limit
The 21-day EMA remains a soft floor with little volume supporting it, even though it is still holding as a tentative support at $3.00. Although momentum is obviously waning, the RSI is still above 57, indicating that it is not yet oversold. The $2.99-$2.75 range, where some stronger moving average support and earlier consolidation levels are stacked, is where XRP could easily fall further if buyers do not intervene soon.
Things might get messy quickly if that region cracks, possibly pushing XRP back to the $2.50 range. The current pattern is illiquid and indecisive rather than bullish, bearish or neutral. That is possibly worse since there is no certainty as to which way the next big move will go, and it could be violent. Avoid overly leveraged positions and refrain from making any significant calls until you see a volume-backed bounce or a capitulation candle.
Dan Burgin
Vladislav Sopov
U.Today Editorial Team