Journalist
Posted:
- The $2.5 resistance has rebuffed XRP bulls multiple times within the past week
- A move to $2.26 was possible, but further losses would signal another price leg downward
In an earlier analysis, AMBCrypto explored how a 27% price rally for Ripple [XRP] could be off the table.
On-chain metrics showed that whales were selling, and the price action of XRP/BTC meant a consolidation was more likely.
In the days since then, XRP continued to trade within a short-term range. It has also defended the key retracement level at $2.29, but bullish hopes would become more tangible with a price move beyond $2.5.
XRP bulls have one advantage in their battle to regain $2.5
Source: XRP/USDT on TradingView
The trading volume over the past few months showed higher overall buying pressure. This was reflected in the OBV, although its upward trajectory has slowed over the past two weeks.
Despite losing the $2.95 former range lows and the bearish structure on the daily chart, there is hope for recovery.
The RSI was below neutral 50, and XRP has tested the $2.5 resistance zone four times within the past week.
Source: XRP/USDT on TradingView
An examination of the H4 chart showed a range formation between $2.3 and $2.5. On the H4 chart, the OBV was in a slight downtrend as the price remained range-bound over the past week.
The trading volume was low compared to the tumultuous start to February.
Source: Coinglass
The liquidation heatmap also underlined the importance of the short-term range formation. There were two liquidation clusters close to the price at $2.26 and $2.54, just beyond the extremes of the range.
Swing traders can use this information to their advantage. They can be on the lookout for a reversal from these two clusters and can monitor the lower timeframe charts in case of a retest to look for long or short entries.
The longer-term outlook was bullish since XRP has defended the 78.6% retracement level successfully. A move beyond $2.5-$2.7 would be a sign of an uptrend beginning.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
