- XRP price action develops two consecutive inside-bar daily candlesticks.
- Rare and powerful bullish reversal pattern in development, confirmation still needed.
- Downside risks remain but are likely limited.
XRP price could return to a leadership position in the altcoin market if it can pull off confirmation of one of the most potent and rare Japanese candlestick patterns in existence: the Squeeze Alert.
XRP price positioning for a monster bear trap and short squeeze
XRP price has a very positive number of bullish confluence levels on its daily chart. Between the candlestick chart and its oscillators, XRP could pull off a huge surprise and begin a significant rally. XRP will first need to complete and confirm the bullish Squeeze Alert pattern to pull off a maneuver that could begin a new bull market.
The Squeeze Alert (bullish) is a three-session reversal indicator that forecasts a turn-around and new uptrend. It is a rare pattern and is one of the most compelling bullish reversal indicators in Japanese candlestick analysis. The probability of a bullish reversal from this pattern is exacerbated if the Squeeze Alert develops near a support level.
- The first session is black (traditional bearish Japanese candlestick color, contemporary is red).
- The second session can be white (green) or black (red).
- The second session high is below the first session high.
- The second session low is above the first session low.
- The third session can also be white (green) or black (red).
- The third session high is below the second session high.
- The third session low is above the second session low.
However, while the current structure shows the Squeeze Alert is nearly complete, confirmation can only occur if an undeniable bullish daily candlestick develops within two to three periods after the third session. For example, a Bullish Engulfing candlestick or a bullish Marubozu would most definitely confirm the bullish Squeeze Alert.
Contributing to the likelihood of a bullish reversal for XRP price is the Composite Index forming support and pushing higher towards a cross above its fast-moving average. At the same time, The %B oscillator is about to cross back above the 0.2 level, giving a strong signal that the recent downside move is likely a massive bear trap.
XRP/USD Daily Ichimoku Chart
Buyers should expect an easy move to rest resistance at $0.90 where the Kijun-Sen, 38.2% Fibonacci retracement, and bottom of the Cloud (Senkou Span A) currently exist. Above that, the next major hurdle is the critical and vital $1.00 level. Ultimately, bulls will need to close and remain above the $1.00 level to pursue any new major uptrend.
The outlook of a bullish reversal will be invalidated if sellers push XRP to a close below the 50% Fibonacci retracement at $0.68. In that scenario, XRP price will likely fall to $0.55 and even deeper to a primary support zone near the $0.36 value area.
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Recommended Content
Editors’ Picks
Is Altcoin Season here as Bitcoin reaches a new all-time high?
Bitcoin reaches a new all-time high of $98,384 on Thursday, with altcoins following the suit. Reports highlight that the recent surge in altcoins was fueled by the victory of crypto-friendly candidate Donal Trump in the US presidential election.
Shanghai court confirms legal recognition of crypto ownership
A Shanghai court has confirmed that owning digital assets, including Bitcoin, is legal under Chinese law. Judge Sun Jie of the Shanghai Songjiang People’s Court shared this opinion through the WeChat account of the Shanghai High People’s Court.
BTC hits an all-time high above $97,850, inches away from the $100K mark
Bitcoin hit a new all-time high of $97,852 on Thursday, and the technical outlook suggests a possible continuation of the rally to $100,000. BTC futures have surged past the $100,000 price mark on Deribit, and Lookonchain data shows whales are accumulating.
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange
Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.
Bitcoin: New high of $100K or correction to $78K?
Bitcoin surged to a new all-time high of $93,265 in the first half of the week, followed by a slight decline in the latter half. Reports highlight that Bitcoin’s current level is still not overvalued and could target levels above $100,000 in the coming weeks.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.