The price of XRP has encountered downward pressure in recent months, with the cryptocurrency facing the risk of falling below the $0.50 support zone. This challenge coincides with Ripple, XRP’s parent company, continuing its legal battle with the Securities and Exchange Commission (SEC).
In assessing the potential trajectory of XRP’s price, a crypto analyst by the pseudonym TheSignalyst shared insights in a TradingView post on February 1. The analyst identified critical levels to monitor for bulls to assert control over XRP.
In the post, the analyst acknowledged that XRP has been navigating a bearish trend confined within a descending channel. He highlighted the current focus on the lower boundary of this channel, where the digital asset finds significant support at $0.5.
The pivotal question remains whether this support will hold and pave the way for a potential bullish reversal.
The analyst emphasized that as long as the critical support level of 0.465 remains intact, there is optimism for short-term buy setups on lower timeframes. This suggests a decisive move below this level could trigger further bearish sentiment.
On the other hand, he pointed out that despite the bearish sentiment surrounding XRP, the token still has some upside potential if key price movements are recorded.
“As long as the support 0.465 holds, we will be looking for short-term buy setups on lower timeframes. For the bulls to take over from a short-term perspective, we need a break above the last minor high at 0.55. And then for the bulls to remain in control and take over from a medium-term perspective, we need a break above the upper red trendline and last major high at 0.6,” he said.
XRP battles bearish sentiments
Indeed, all eyes are on XRP, focusing on maintaining its price above the $0.50 level, as it is considered a crucial anchor for the cryptocurrency to retest the $0.60 level. XRP has not revisited the $0.60 mark since mid-January, making it the primary target. In the short term, XRP’s price has fluctuated between $0.55 and $0.49.
Notably, bulls perceive XRP’s current position favorably and see it as an opportunity to accumulate, expecting to drive the price higher. This sentiment follows XRP’s recent formation of its first death cross for the year, marked by its short-term moving average crossing below the long-term moving average.
At the same time, XRP has closely mirrored the overall crypto market, lacking bullish catalysts from other factors, including the ongoing Ripple and SEC case. In the recent development, the SEC is actively seeking access to the financial statements of the blockchain firm, a move opposed by Ripple.
Meanwhile, XRP encountered additional headwinds due to hacking incidents, resulting in the loss of 213 million XRP, equivalent to $112.5 million. Notably, this loss impacted the wallet of Ripple’s co-founder, Chris Larsen.
In response to the hack, crypto exchange Binance froze $4.2 million worth of XRP believed to be associated with the breach. Notably, this hack has sent shockwaves through the crypto space, being the first major one reported in 2024.
XRP price analysis
By press time, XRP was trading at $0.52, marking a daily gain of over 3%. However, on the weekly chart, XRP showed a decline of 1.6%.
Despite the short-term gains in XRP, the token’s technical indicators are bearish. A summary of the one-day gauges retrieved from TradingView indicates a ‘sell’ rating at 11 while moving averages suggest a ‘strong sell’ at 11. Oscillators are indicating a ‘buy’ at 2.
In conclusion, although XRP has followed the general market trend, the token needs strong fundamentals to initiate a potential price rally. The token’s performance will partly depend on a move supported by Ripple’s underlying business.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
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