Originally published on: November 27, 2024
XRP has taken a nosedive, dropping over 17% just days after hitting a multi-year high near $1.63, now trading around $1.41 as of Nov. 27. Despite this recent dip, the cryptocurrency is still up nearly 180% in what’s being called its “Trump Trade” surge, marking its most successful month since April 2021.
The Relative Strength Index (RSI) for XRP has been soaring above 70 on daily charts all through November, indicating a potential fatigue in its upward momentum. History shows that XRP has a tendency to sharply correct after RSI levels go into overbought territory. This has been evident in past instances where XRP plummeted by significant margins after high RSI readings.
Current price levels are also in line with Fibonacci retracement extensions, with $1 emerging as a possible support level in case of a correction. The $1 psychological mark could act as a temporary floor, while a more substantial pullback might see XRP revisiting the 50-day Exponential Moving Average near $0.85.
Interestingly, a decrease in XRP holdings among its largest investors signals a shift from accumulating to distributing phase. This suggests that whales are offloading their holdings to retail investors amid the current rally.
XRP’s recent breakout from a giant symmetrical triangle pattern on a weekly chart hints at a long-term uptrend. This breakout, occurring for the first time in seven years, echoes a similar move that led to XRP’s remarkable rally back in 2017-2018.
Fundamentally, factors like potential Trump reelection and Ripple’s strategic partnerships could propel XRP’s growth further. However, the 6-week RSI hitting 70 might trigger short-term corrections or consolidation periods, potentially testing the triangle’s upper trendline around $1.00.
As always, this is not financial advice, and readers are encouraged to conduct their own research before making any investment decisions.
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