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The most recent attempt by XRP to recover has encountered a well-known issue: resistance.
The asset managed to rise back toward the critical $1.30 region after bouncing sharply from local lows near $1.08, but it was instantly rejected. XRP is caught between regaining momentum and a still-dominant bearish trend as a result of the failed breakout, which indicates that sellers are still active at previous support levels.
Regaining the $1.30 area was always going to be challenging. It closely resembles the 100-day moving average and represents the support level that was lost during the most recent breakdown. A clean breakout was thwarted as XRP got closer to the zone because profit-taking started to emerge and buying pressure decreased.
Momentum is back
Technically speaking, the rejection itself is not disastrous. Whether XRP can sustain the higher low set following the capitulation event earlier this month is what matters right now. In contrast to the panic-selling phase that propelled the asset toward $1.08, the recent rebound pushed the Relative Strength Index back above neutral territory, demonstrating that momentum has greatly improved.
The 50-day moving average around $1.23 is the first important level to keep an eye on. After regaining it during the rebound, XRP is now making an effort to stay above this region. Another test of the $1.30-$1.32 resistance zone is more likely if buyers can hold this support.
XRP's potential to breakthrough
The 200-day moving average around $1.38 and the larger resistance area around $1.50 would be the next targets if XRP were to break above $1.32. A move into that range might indicate the start of a more extensive recovery phase and represent a significant change in market sentiment.
On the downside, the bullish case would be significantly weakened if the 50-day moving average was not maintained. The most significant level is still the recent swing low around $1.08, while the first support is located close to $1.18. The path to psychological support at $1.00 would be reopened if that support were lost, invalidating much of the recent recovery.
Although volume has increased since the initial bounce, it is still below the levels usually linked to significant trend reversals. This implies that conviction is still low even though buyers have returned.
Though not enough to overcome resistance, the market has recovered enough to challenge it. The direction of XRP going into the second half of the month should be decided by the next battle between bulls and bears, which is probably going to occur around the $1.23-$1.32 range.
U.Today Editorial Team
Dan Burgin
