Cryptocurrencies

XRP Analysis: Rise Now, or Never?


The cryptocurrency XRP fluctuates a bit without showing much strength. This is the case with many altcoins, and we haven’t seen any nice increases in weeks. The bullish narrative is slowly fading and fear is starting to rise again. In anxious periods we look for opportunities, and XRP offers these opportunities.

12-hour chart: bounce now!

If XRP can regain its strength, this is the time for a nice bounce. The price broke out of a pattern a few days ago and took out the lows for liquidity. Positions have been liquidated and from the wicks you can see that buyers are stepping in to prevent further declines. I hope this trend will continue and volume will increase. This would be a positive signal for a local bottom.

It is crucial that the price moves well above 50 cents so that we can try to break above the Bull Market Support Band (the orange band on the top chart). This indicator combines two other indicators and often functions as support or resistance. Now that the price has fallen, it will be a major challenge to break through this resistance, but it is always a mistake not to take a shot.

Above the Bull Market Support Band, the sky is the limit, and we will quickly move towards 60 and 70 cents. However, as long as we remain below this band, it is wise to keep an eye on volume, the Bull Market Support Band and Open Interest. I will now explain what Open Interest exactly means.

The Open Interest: long positions liquidated en masse

The Open Interest is a representation of the number of open positions. From this you can deduce whether the majority of traders have gone long (betting on a price rise) or short (betting on a price fall). We know that when one side is overrepresented, it will often be liquidated first before the price will continue its way.

With this knowledge we look at the price movements of the past months. We see that every time the price rose, the Open Interest (OI) also increased. This means that more and more long positions were opened as the price rose. Shortly afterwards, however, a sharp price drop followed, with the OI completely collapsing. This phenomenon is called a lung squeeze.

We’ve seen this three times in a row, with the most recent coming a few weeks ago. With the price moving fairly steadily and the OI being low, no side is overrepresented. As a result, we can reasonably expect that the next move will be a healthy one that will set the trend for the coming months. In my opinion, this trend will be positive, with upcoming declines just for buying.

Conclusion

Slowly but surely, positive signals are visible in XRP, although these are still early. It is now crucial to monitor the indicators closely and be alert for the start of an upward move so that you do not miss the coming rise. And beware: it can happen quickly…

The post XRP Analysis: Rise Now, or Never? appeared first on BLOX | News.

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