In a tumultuous day for cryptocurrencies, the price of XRP plunged to a low of $0.38249 on Bitstamp, reflecting a broader bearish trend affecting the altcoin market. With a notable 12.4% drop in the past 24 hours, XRP faces crucial support. Despite this substantial decline, Dark Defender (@DefendDark), a notable crypto analyst on X, continues to maintain an optimistic outlook on XRP’s future prospects.
XRP Price Needs to Hold at $0.39
In his analysis From the 1-month XRP/USD chart, Dark Defender notes specific key levels and indicators. He points out that “XRP has reached our last support level of $0.3917 after staying below $0.4623 for 3 consecutive candles.” This observation is crucial because it highlights XRP’s resilience at a significant support level – the Point of Control (POC).
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The POC, where Dark Defender indicates “Green Dotted Line – the price level where most trading has occurred since 2014,” is at $0.3917. This level serves as a focal point for trader consensus on value, historically providing a solid base for price. The recent touching of this level suggests a testing ground where high feelings could potentially stabilize and reverse the downtrend.
The Dark Defender chart also includes Fibonacci retracement levels, which are key to identifying potential support and resistance areas based on past price movements. According to Dark Defender, the $0.4623 level, which corresponds to the 38.20% Fibonacci retracement, represents significant resistance. If XRP rises above this threshold, it could pave the way for further gains towards higher Fibonacci levels such as $0.6649 and $1.8815, which correspond to the 70.20% and 161.80% retracements, respectively.
Dark Defender highlights the Relative Strength Index (RSI), stating: “XRP Daily & Weekly RSI are bottoming and oversold.” This indicates that the asset is potentially undervalued and such conditions often precede a price recovery. He also compares the current monthly RSI levels with those seen during major market funds in March 2020 and November 2022, suggesting a possible repetition of the recovery patterns observed in these periods.
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The volume profile on the chart highlights the presence of substantial trading activity in and around the POC. This high volume at lower prices signals robust buying interest, which could cushion further declines and establish a strong base of support.
Overall, Dark Defender presents a case for a potential bullish reversal for XRP. His close examination of support levels, particularly the resilience at $0.3917, coupled with oversold RSI conditions and historically significant trading volume at that price, paints a picture of possible upward momentum.
As the market digests these levels, the ability to sustain above $0.3917 will be critical in determining its near-term price trajectory, potentially mirroring the 2014-2017 recovery phases. From March to May 2017, XRP rallied over 6,600%, from under $0.006 to $0.40.
If history repeats itself, XRP’s price could see a massive rally. However, Dark Defender’s final observation: “The 2014-2017 pattern is still identical unless $0.3917 is not protected. I will keep you updated,” underscores the pivotal nature of this support level in the ongoing market dynamics.
At the time of writing, XRP was trading at $0.41042.
Featured image created with DALL·E, chart from TradingView.com