XRP price formed a bottom reversal setup, suggests the possibility of an explosive move favoring the bulls
XRP price has established a bottom reversal configuration, indicating the prospect of an explosive bullish surge. Furthermore, Ripple has already broken the pattern, indicating that the rally has begun. To profit from the upcoming move, interested investors should pay special attention to the retest of a key support level.
XRP price formed an inverse head and shoulders pattern, indicating the beginning of an uptrend. Three valleys of differing depths make up this complicated formation. The head refers to the central dip, usually more profound than the lateral. The shoulders are the narrower valleys on either side of the head.
A neckline is formed by connecting the peaks of these valleys, which is useful in determining the breakout.
The 25% objective for this arrangement is calculated by multiplying the distance between the neckline and the lowest point of the head. When you add this figure to the breakout point, you get a target of $1. Ripple, interestingly, already broke through the neckline on March 19th, indicating that the trend may continue.
XRP/USDT 4-hour chart | Source: TradingView
If the neckline retest holds, sidelined investors or purchasers can start purchasing the dips, with the remittance token rallying 25% and retesting the $1 psychological milestone.
The supply distribution indicator backs up the bullish thesis from a technical standpoint. This index keeps track of XRP wallets divided into categories based on the number of coins they own.
According to this on-chain indicator, whales with more than 10,000,000 XRP coins have been collected. The total number of wallets in this category has increased from 317 to 335.
In the previous month, 18 new whales have joined, indicating their intents and high predictions for the XRP price. As a result, market participants should expect a significant increase in the remittance token in the following days or weeks.
XRP supply distribution chart
Regardless of the optimistic perspective, the breakout does not always hold on to the retest, and the price drops. The bullish thesis will be invalidated if bears force the XRP price to make a lower low below the right shoulder ($0.74). Such a scenario is feasible, and it might jeopardize the positive outlook.
Investors can expect the Ripple price to fall in this event, finding support around $0.702. Buyers can try again for the uptrend despite the invalidation of the inverse head and shoulders configuration.
- Ripple, Anon Wallets, And Major US Digital Exchanges Have Wired A Close To 160 Million XRP
- Ripple General Counsel Believes That 2022 Might Be A Decisive One For Crypto’s Future In The U.S