Ripple (XRP) could break above $0.30 and move higher, with bulls likely to target $0.40 in the next wave.
XRP has been trading sideways over the past few days, with its lack of a meaningful bullish move allowing Polkadot (DOT) to overtake it as the fourth largest cryptocurrency by market cap.
Ripple’s poor performance since the SEC sued the company and its top executives meant it was always likely to be taken by senior officials like the DOT.
However, Ripple may return to the top three if its price breaks out of consolidation and moves towards a retest of the 50-day SMA on the daily chart. If this happens, XRP could rise to new year-to-date highs.
At the time of writing, the original Ripple token is up 3.2% and is trading around $0.28.
The 4 hour chart is showing that buying pressure is increasing, with the Relative Strength Index (RSI) indicating positive divergence above the 50 line.
4 hour XRP/USD chart. Source: TradingView
The MACD also indicates a subtle bullish reversal, with the shorter 12-day curve indicating a cross above the 26-day EMA curve. If the index strengthens in the upcoming sessions, expect the momentum to shift in the direction of the bulls, with XRP trading higher.
The chart also shows that XRP is also trading above the 100 day simple moving average. If buyers maintain the bullish momentum and the breakout resistance at the 50-SMA on the 4-hour chart ($0.29), an extended move above $0.30 could see XRP/USD pressure outside its sideways range.
The daily chart shows two targets above the $0.30 price level that could be pivotal to XRP’s short-term price action. The first line is a horizontal resistance line just above $0.32. Previous attempts to break higher stopped at this level.
If the bulls can turn this barrier into support, the presence of higher daily candles will provide the cushion that buyers may need as they target the 100-day simple moving average at $0.36.
XRP/USD daily chart. Source: TradingView
XRP technical forecast also indicates a possible buy signal on the daily chart. If the signal flashes in the form of a red nine candle in the next session, it is likely that the influx of buyers on higher volumes will push XRP/USD higher.
This means that a break above $0.36 has the potential to stimulate further upward movement. If this happens, XRP may retest the resistance at the 50-day SMA ($0.40).
The other side of the bullish picture above will be a pullback to the initial support level at $0.25. If the downward pressure increases around these price levels, it could mean a further decline to the long-term support area near $0.20.