XRP Holds Strong at Key Levels: Could a $4.40 Breakout Be Coming?

Ripple’s XRP has been in the spotlight recently and has formed three bull pennants in a row. This pattern is a bullish continuous pattern indicating potential for further price appreciation in the near future. At the moment, XRP is in a sideways trend trading between $2.22 and $2.60, which indicate a possibility of a break out soon.

The first bull pennant was formed after the price of XRP rose from $0.80 to $1.20. The price went up, and after some consolidation, it went up again in the following hours of the rally. The second pennant was almost similar to the first one since XRP rose from $1.20 to $1.80. There was another round of consolidation and then a breakout of sorts after that. The third pennant formed when XRP jumped from $1.80 to $2.50.

Ali Martinez’s XRP Forecast

In a recent post, analyst Ali Martinez noted that if the price of XRP is able to break through the current level of $2.60, then the next target maybe $4.40. He also pointed to the $2.25 level as another crucial support level, which could be a good entry point for those willing to join the longs and go long on the price increase. Martinez’s note is based on the assumption that the upward trend that has been seen in the past few weeks will be continued.

Several technical aspects suggest that the coming days will be favourable for XRP. The cryptocurrency is at the moment trading above the lower standard deviation line of the Bollinger Bands signifying an upward trend. Even though XRP has retreated slightly from the upper Bollinger Band, the midline at $1.93 could be vital if the price goes back lower.

Bullish Signals for XRP

Other indicators of momentum also support the conclusion that the upward trend will continue. The Relative Strength Index (RSI) is 67.33 which indicate strong bullish pattern but the value is close to overbought level. This slight pull back could mean that the price of XRP may stabilize for sometime before it starts rising again. 

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The MACD indicator also agrees with this view as the MACD line is still above the signal line. Even though the histogram bars have shrunk somewhat, the general picture is one of growth.

The trading volume of XRP has been increasing lately. As Cloinglass reports, XRP trading volume has grown by 13.86% and is now equal to $16.44 bln. Also, the options volume has increased by 17.41%, which shows that more and more people are putting their money on the cryptocurrency. 

Optimism Vs. Market Volatility

The open interest in options contracts has also gone up by 16.20%, which indicates trading fraternity is becoming more and more optimistic. Nevertheless, the open interest in perpetual contracts has decreased by 3.89%, which is an indication that some of the traders are closing their positions owing to the recent pull back.

Similarly, the Long/Short Ratio also gives an impression that the traders are bullish. On Binance, the ratio is 3.76 while on OKX, the ratio is 2.31. These numbers suggest that most traders are actually placing their money on a price rise as opposed to a price drop. However, there has been evident liquidation even with the bulls in charge. Over the last day, liquidations piled up to $21.31 million with $13.37 million being long positions. This indicates that the market is still very much unpredictable, but the long-term outlook is still firmly bullish.

Altogether, XRP’s price continues to look bullish, with technicals, volumes, and sentiment all aligning for a possible breakout. If XRP manages to price break through the $2.60 level, then the next level that could be targeted is $4.40. Traders will be keen to look for any break as the asset continues to trade within this range. Having strong base levels and growing market demand, XRP has all the potential for further growth in the short-term perspective.

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