“You’re not bullish enough!” an XRP fanatic exclaimed on X final week after Ripple, which makes use of the token for cross-border transactions, introduced that the U.S. Securities and Trade Fee has dropped its case towards them.
Many others share this pleasure, and understandably so, because the conclusion of this long-standing authorized battle has lifted a weight that hindered XRP’s efficiency in comparison with the broader market in the course of the 2021 bull run. Plus, there may be XRP ETF hype and hopes that the token may grow to be part of the U.S. strategic reserve.
That mentioned, the current worth motion doesn’t mirror the above optimism, with key momentum indicators flashing a serious bearish shift in development, warning of a notable worth slide forward.
XRP surged over 11% to $2.59 final Wednesday, cheering the SEC information. Since then, the observe by way of has been something however bullish with costs rangebound between $2.30-$2.50, regardless of optimism that anticipated reciprocal commerce tariffs from President Donald Trump on April 2 could possibly be extra measured than initially anticipated.
Three-line break chart
The primary indicator signaling bearish development reversal is the three-line break chart, which focuses solely on worth actions whereas filtering out short-term noise, serving to establish development adjustments as instructed by the market and never arbitrary/discretionary buying and selling guidelines.
The chart consists of vertical blocks known as strains or bars (inexperienced and purple). A bull reversal occurs when a inexperienced bar happens with costs transferring greater than the best level of the final three purple bars. Quite the opposite, a bearish shift is represented by the emergence of a brand new purple bar that goes past the bottom level of the earlier three inexperienced bars.
In XRP’s case, a brand new purple bar occurred early this month within the weekly timeframe and has held intact following the SEC information. The “weekly” side means this chart aggregates worth data over per week.
The brand new purple bar signifies a bullish-to-bearish shift in momentum. Related patterns characterised the beginnings of extended bear markets in 2021 and early 2018.
MACD
The transferring common convergence divergence (MACD) histogram, used to gauge development power and development adjustments, is producing deeper bars beneath the zero line on the weekly chart. It is a signal of the strengthening of the draw back momentum.
The identical indicator flipped optimistic in November, after which costs surged from $1 to above $3.
The 5- and 10-week easy transferring averages (SMAs) have crossed bearish as nicely, suggesting the trail of least resistance is to the draw back.
Bollinger Bands
The Bollinger bands – volatility bands positioned two normal deviations above and beneath XRP’s 20-week SMA – have widened in response to the sharp worth rally in late 2024 and early this yr.
Traditionally, costs have tended to maneuver decrease following the sharp widening of the Bollinger bands, as noticed after mid-2021 and early 2018.
When bullish?
A agency transfer of $3, the excessive registered on March 2, would invalidate the bearish setup, negating the decrease highs sample to counsel a renewed bullish technical outlook.
Some analysts count on XRP to achieve as excessive as $10 by the top of this decade.
