XRP price has been on an impressive run over the past few days, but yesterday it came to an abrupt end. After rising to $0.6378, it temporarily dropped by over 11%. However, popular crypto analyst Dark Defender (@DefendDark) remains bullish on the short term, even though the decline could increase further in the short term.
XRP Price May Eclipse $1 Mark Again
According to him, the price of XRP is in a promising short-term uptrend towards the $1.03 mark. This analysis is based on the 4-hour timeframe and shows a complex interplay of market dynamics and technical patterns that suggest a bullish outlook for the cryptocurrency.
The chart shared by Dark Defender shows XRP’s significant recovery, marked by a 67.56% increase from a low of $0.3814 to a recent high of $0.6378. The forecast uses Elliott Wave Theory and Fibonacci retracement levels to predict target price. Both technical analysis tools are often used to predict potential price levels based on past market behavior.
Elliott Wave Theory, which forms a core component of Dark Defender’s analysis, posits that market prices unfold in specific patterns, called waves, that are repetitive in nature. According to this theory, a typical cycle includes eight waves – five in the direction of the prevailing trend followed by three corrective waves, which Dark Defender identifies on the XRP chart.
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The impulse sequence observed in XRP recent uptrend consists of five ascending waves labeled (1) through (5). This sequence shows a strong upward movement from the local low to yesterday’s high. Each wave peaked higher than the previous one, reflecting growing optimism among investors.
Following the impulse, the chart outlines an ABC corrective pattern, which is characteristic of a temporary reversal in price after the rapid gains of impulse waves. Wave A signifies the initial decline from the peak, wave B reflects a partial upward retracement, and wave C, which is anticipated but not yet completed, typically falls below the end of wave A, indicating a potential further decline in price.
Dark Defender’s chart marks the beginning of this corrective phase, suggesting that wave C could pull the price down to around $0.499 before the market resumes its upward trajectory. “Wave ABC could take 2 days to complete and could reach $0.499,” the crypto analyst noted.
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To complement Elliott Wave analysis, Dark Defender employs Fibonacci retracement levels, which are plotted between recent lows and highs on the chart to predict potential support and resistance levels. Notably, a 261.8% extension level at $0.5891 is highlighted as an interim resistance point. Other extensions, such as a 161.8% level at $0.8763, serve to identify additional barriers that price may test if the high momentum continued.
However, Dark Defender’s short-term price target is significantly higher. According to him, XRP could revisit the $1 mark, which it narrowly missed following the summary judgment in the Ripple vs. SEC case in mid-July last year. “Minor resistance at $0.87 before $1.03. Will be sure to keep you posted,” the analyst wrote.
Furthermore, the chart features an Ichimoku Cloud, indicating that the current price is above the cloud, which is traditionally interpreted as a bullish signal. This suggests that despite the expected corrective decline, overall market conditions favor a bullish outlook in the short term.
At the time of writing, XRP was trading at $0.58.
Featured image created with DALL·E, chart from TradingView.com