Can XRP price reach $1 after 25% gains in one week? Watch this key support level

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XRP value has continued to bounce again after falling by more than 70% in a correction between April 2021 and January 2022.

Why the XRP/USD 50-week EMA is vital

On Feb. 13, XRP/USD reached as excessive as $0.916, above its 50-week exponential transferring common (50-week EMA; the pink wave) round $0.833. The upside transfer, albeit not decisive, opened potentialities for additional bullish momentum, primarily owing to a historic shopping for sentiment across the mentioned wave.

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XRP/USD weekly value chart that includes 50-week EMA. Supply: TradingView

For example, merchants had efficiently reclaimed the 50-week EMA as assist within the week ending July 27, 2020, greater than a yr after flipping the wave as resistance. Later, XRP’s price rallied by greater than 820% to $1.98 in April 2021, its finest degree in additional than three years.

Conversely, throughout the bearish cycles between 2018 and 2020, XRP’s 50-week EMA acted as a powerful resistance degree on a number of events. That confirmed the wave’s capability to face up to bullish restoration sentiments, such because the one witnessed throughout the present value rebound.

Can XRP retake $1? 

XRP now wants to carry decisively above its 50-week EMA, which may have it reclaim $1 within the classes forward.

The extent, which sits round 25% above the present value ranges, coincides with XRP’s two key resistance targets. The primary is the multi-month downward sloping trendline that has been capping the token’s upside bias since April 2021

XRP/USD weekly value chart that includes upside goal. Supply: TradingView

In the meantime, the second goal is the 0.382 Fib line of the Fibonacci retracement degree drawn between $2.70-swing excessive and $0.10-swing low, additionally having a historical past of limiting XRP’s sturdy traits by performing as each assist and resistance.

Nonetheless a decrease excessive, the $1-level doesn’t promise to take XRP out of its correction bias. As a substitute, it might deliver alternatives for merchants to safe their interim income, thus exposing XRP to a pullback towards an imminent assist goal close to $0.71, as per the Fibonacci retracement graph. 

The bears’ case 

Conversely, failure to acquire a decisive shut above the 50-week EMA resistance may have XRP eye a pullback towards its 200-week EMA (the blue wave) close to $0.54.

This transfer dangers trapping the worth inside a variety outlined by 50-week EMA as resistance and 200-week EMA as assist, which can lead to an extra breakout to the draw back. The bearish outlook seems out of a fractal from June 2018-June 2019 session, as proven within the chart under.

XRP/USD weekly value chart. Supply: TradingView

Notably, XRP’s run-up to its record high of $3.55 in January 2018 coincided with its weekly relative power index (RSI), forming a decrease excessive, thus confirming a bearish divergence.

Later, the worth declined under its 50-week EMA however picked assist from its 200-week EMA. The RSI’s fall additionally exhausted close to 37, simply above its oversold studying of 30.

XRP trended sideways contained in the mentioned transferring common vary, whereas the RSI maintained a studying above 37. Nonetheless, in June 2019, the worth broke under the 200-day EMA assist, extending its decline to as low as $0.10 as of March 2020.

Associated: XRP gains 30% after Ripple gets permission to explain ‘fair notice defense’ vs. SEC

If the fractal performs out because it did in 2018-2019, XRP would danger breaking under its 200-week EMA assist close to $0.54 within the coming classes. Such a transfer could shift XRP’s interim draw back goal to the 0.786 Fib line close to $0.43, in line with the Fibonacci retracement graph painted from $0.14-swing low to $1.52-swing excessive.

XRP/USD weekly value chart that includes draw back targets. Supply: TradingView

In the meantime, an extra break under $0.43 would put the subsequent draw back goal at $0.22, a degree with a historical past of high-volume buying and selling exercise.

The views and opinions expressed listed here are solely these of the writer and don’t essentially replicate the views of Cointelegraph.com. Each funding and buying and selling transfer includes danger, it is best to conduct your personal analysis when making a call.