Has XRP broken out of the bearish trend?
On 7th April, Daneel discovered an article titled “Is Ripple Undervalued After Fiat-ILP interoperability demo? This article made us look at technical properties of the XRP, and to further investigate what is ILP. ILP is a platform built by the ripple team, which connects independent blockchains to facilitate transfer of value without relying on a single currency. It is important to note, that even though ILP is created by the ripple team, the network has no central authority or company and the protocol is not tied to any currency, token or blockchain. Rather, the network is made up of connectors, which are independent operator that act as a decentralized exchanges, market makers for cryptocurrencies, fiat currencies, and other tokenized assets. Using this network, it is unecessary for a user to transfer their cryptocurrency to the centralized exchange, to be able to exchange it to the required cryptocurrency, to be able to pay for the services of other blockchains. Rather, sender can pay in whatever currency of his choice, and know that the receiver will receive his desired asset without having to trust the party which faciliates the exchange. In plain words, it doesn’t matter that we only own ETH and that our partner accepts only BTC. We simply send ETH, connector exchanges it to the desired asset (in our example BTC), and forwards it to the receiver. As we know, native currency of the blockchain doesn’t have to be just a currency, it can be as well any tokenized asset and etc. That means that there is a digital economy, waiting to be connected with our traditional economy, and ILP, by adding Fiat-ILP interoperability, could therefore very well serve this purpose.
Even though XRP is not needed to facilitate the transactions, the article made us look at the technical properties of the token. As you can see in the picture below, XRP has broken out of the bearish trend as the daily candle closed above the long term trend line. This breakout is noticable even in the case of RSI and CMF, volume is on the rise, and as the weight of evidence suggests, XRP’s price will continue higher. In that case, the first two red horizontal lines should be easy for ripple to reach, and would make a good target for you to take at least a part of your profits, in case you decide to enter long on this set up.
If the 4 hour candle closes below the support, it would be wise to abandon the position, since that would impply that the price will drop noticeablly. That makes this trade rather risky, because if you enter now, you would be able to strategically leave, as the support breaks, only after loosing 15.83%. Though if the break out is correct, the second target shouldn’t be hard for XRP to reach, which would leave you with 30.30% profit on this trade. Once the second target is reached, it’s possible that after correcting, the price will continue rising. That’s why we consider this trade risky, though potentially very profitable.
Ripple has been recently a subject to a lot of news, and thanks to the Daneel, we were able to keep up with them. If you would like to know what news surround ripple, we have chosen few of them for you, and if you would like to read them, you can find them below the picture.
https://go.daneel.io/news?s=ripple-powered-moneytap-receives-investing-from-13-leading-banks-announces-sbi-&fbclid=IwAR2dT_ISIuau6ZOySluAz6txiKtFbBorfrfsFdkimUk55sQ4LNdYe0Kdayk
https://go.daneel.io/news?s=is-ripple-xrp-undervalued-after-fiat-ilp-interoperability-demo-&fbclid=IwAR0rEFQxxNC1Fnui9OZFv-MQD0ETlTmNL8uVMUacPv0E-2bvP3_WfaIQB_c
https://go.daneel.io/news?s=germany-second-largest-exchange-now-lists-xrp-and-ltc-based-etp&fbclid=IwAR0RrWGmu4ePEL4SwnvVir-QGK2kBwBWaraXSHq8QQubfDCofChYDVMf7eE
https://go.daneel.io/news?s=ripple-co-founder-donates-25-million-in-xrp-to-san-francisco-state-university&fbclid=IwAR0TK5Q2DfllFXxYexpwC98oAsNbVLCZE43TqBVQnp3nw0SHIjU63rGl5NE
https://go.daneel.io/news?s=ripple-is-partnering-with-a-global-it-company-with-ties-to-major-banks-will-it-affect-xrp-&fbclid=IwAR1BU1F3BOZD5zMPfbnmDRnYTwSiMjh0m4kojBNMhrG4I99fgW3m7Q4Tf4s
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At the beginning of the week, we have shared with you an analysis of the XRP. As you can see from the picture attached, bulls have been denied the break out of the pattern and therefore the price has been falling for the past two days. At the time of writing, price managed to stop on the 0.618 level of the fibonacci retracement, and in case circumstances favor break to the upside, these levels would be suitable to accumulate at.
Meanwhile, Bitcoin’s dominance have climbed over the weekend to the levels of current resistance on the low weekly volume as the CMF line stopped at the bottom of its long term patter, there are now two scenarios that we could see playing out. One possible scenarios it that the weekly CMF pattern will be broken as the weekly candle doesn’t penetrate the top of the price pattern. The other one is that the CMF line will bounce from these levels as the dominance breaks the top of the outlined dominance pattern. Since many altcoins are undervalued in relation to BTC, if the first scenraio takook place and the BTC’s dominance decreased, it’s very likely that altcoins will surge as Bitcoin will continue sideways. If the Bitcoin dominance breaks to the upside, it would imply that investors are abandoning altcoins, coming back to the more stable BTC.
To conclude, it’s impossible to fully predict in which direction will the price break. Though as BTC seems stronger than it has ever been through out the bear market, the odds favor final break out to be to the upside. Only time will tell, and therefore those who are fundamentally bullish should consider accumulating on these and possible future lower levels. Those of you who are fundamentally bearish should consider selling today as the price retraces up. We wish you a strong hands and good luck trading!