Recently, the XRP price has been in an uptrend, spurred on by the improving macro political climate and the Bitcoin price crossing $70,000. But while this move has brought some much-needed positive sentiment back into the market, one analyst is calling for caution during this time. The call points to the fact that the move above $1.4 might be only temporary and that the price downtrend will resume in short succession, trapping investors in their positions.
The XRP Trendline To Watch For A Lower Break
Over the last few weeks, the XRP price had formed an interesting trendline, which crypto analyst CasiTrades had called out. At a point, the XRP price was still trading above the trendline, suggesting that the trend was still very bullish. However, the digital asset has now seen its price fall below this trendline, putting it in a very perilous position.
CasiTrades explains that the price break below this trendline has seen it begin to act more like resistance at this level. If that is the case, it means that the price might not be able to break out of it, and if it is pushed down, then it could trigger another wave down.
The recent price recovery, the crypto analyst explains, could be a subwave 2 bounce. Such a bounce is historically short-lived and actually tends to give way to more declines. As a result, at the first sign of resistance, it is possible that the XRP price will be harshly rejected, triggering the next move down.
Such a move would eventually see no support above the $1, and this would leave room for the bears to drag the price further down. In fact, the crypto analyst says that the next major support on the leg down lies around $0.87. This would constitute a 40% crash from current levels at the time of writing.
As for levels to watch, CasiTrades says to keep an eye on $1.40-$1.41 for the B wave. For the C wave, the major levels to watch are $1.51-$1.55, and these targets are for the short-term. “Either we head down to $0.87, or we somehow break and hold $1.65 resistance,” the analyst stated.
Featured image from Dall.E, chart from TradingView.com
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