xrp crypto value

XRP readies for 40% rally, as the crypto market consolidates

Crypto markets look for a floor as risks remain
Written by publisher team

  • Bitcoin price continues to wrap inside a symmetrical triangle, with the top of the pattern converging on June 10th.
  • Ethereum price closed in May with a long-legged doji pattern indicating the balance between the forces of supply and demand.
  • XRP price constitutes a high-handled base cup, the first high-probability opportunity for investors.

Bitcoin price wraps inside a symmetrical triangle, but the risk increases as the pattern fails to resolve it. Ethereum price remains below the 50-day simple moving average (SMA), but on-chain metrics are improving. XRP price is attempting to establish support once again above $1.00, which puts it on a sustainable path of progression.

Bitcoin price needs to push the price very soon, or it could drift away

Bitcoin price has been defining a symmetrical triangle since May 19, with the price now covering about 75% of the triangle, but it has become a problem for enthusiastic bulls. The further away prices are from the top of the triangle without breaking out into trend lines, the less momentum the pattern will have. Instead of increasing strength, it begins to lose effectiveness at a certain point.

Based on historical precedent, the best price trends appear when the price is between one-half and three-quarters of the horizontal distance from the base to the top. After three quarters, prices usually extend to the top and often lead to a price skew, which does not provide a clear forecast for the future.

Bitcoin price has reached a critical moment in building a symmetrical triangle formation. It sits at the furthest distance from the top for a huge price push, but any further consolidation leaves the formation vulnerable to minor fatigue.

The BTC symmetrical triangle is below the intersection of multiple levels of resistance that will challenge the bitcoin price for days and possibly weeks to come if the triangle resolves to the upside. Resistance includes the 38.2% Fib retracement of the historical rally from the March 2020 low to the April high at $41,581, the January 8 high at $41,986, the February 28 low at $33,016 and the 38.2 retracement level. % of the April-May drop at $43,331. .

The measured movement of the BTC triangle is around 30%, which creates an upward target of $50,325 from the current position of the triangle’s upper trendline, which closely matches the 50-day simple moving average at $49,248. To trigger a rally towards the measured move target, bitcoin price needs to overcome the aforementioned significant resistance and the 200-day SMA at $41,363.

BTC/USD daily chart

If the pattern turns bearish, the target is $23,649 from the current position of the triangle’s lower trendline. Bitcoin price will break the May 19 low at $30K, retrieval of 61.8% of the advance that started in March 2020 at $27,175.

It is necessary to note that the BTC target downside is slightly above the 2017 high of $19891.

Ethereum price backed by optimizing on-chain metrics

A bullish hammer candle on ETH’s 12-hour chart started rebounding on May 23 after printing an oversold reading on the daily Relative Strength Index (RSI). It was accompanied by an above average size. Moreover, the May 23 drop from the May 19 low created a double bottom pattern with a $3,000 launch price.

Ethereum price is posting a 6% gain at the time of writing, based on the breakout from the inverted head and shoulders pattern on the four-hour chart. The measured movement is about 14% of the neckline. ETH just hit the measured move target of $2,781.

If the rally continues to gain price traction, Ethereum price will engage a resistance at $2900 and then a double bottom at $3000. A push behind the double bottom trigger would quickly locate the resistance at the four-hour 200 moving average at $3,116. After the main MA is the 61.8% Fib retracement of the May retracement at $3,369.

ETH/USD 4-hour chart

ETH/USD 4-hour chart

A daily close below $2,527 lowers Ethereum price expectations and raises the possibility of selling ETH to the lower right shoulder level at $2,275.

From May 8 to May 22, the number of active addresses included in ETH transactions decreased from 791.71K to 514.67K, which represents a 35% decrease. The metric indicates the daily level of collective interaction (speculation) with Ethereum.

The scale has rebounded modestly since May 22, indicating a return to digital assets by investors. The bounce was stronger than Bitcoin.

Active Daily ETH Addresses - Santiment

Active Daily ETH Addresses – Santiment

The Santiment measure of market value/realized value (MVRV) measures when the market is undervalued or overvalued. Negative values ​​indicate that the market is undervalued, providing a potential buying opportunity, while positive values ​​indicate that the market is overvalued and sold.

The 365-day MVRV did not hit negative levels during the May correction, showing that there is still more profit to be made by long-term holders. However, when viewed in the context of the larger advance, MVRV reached its lowest level since October 2020. Overall, the metric shows that there is room for more ETH price appreciation going forward.

ETH 365-day MVRV - Santiment

ETH 365-day MVRV – Santiment

With relatively low and active MVRV addresses increasing, Ethereum price is building the foundation for this slight upward trend to advance significantly.

XRP price forms the basis, but on-chain metrics remain hesitant

XRP price shows a teacup base with a high handle on the four charts, with a measured move target of $1,539, which results in a 40% return from the high handle at $1.10. The development of the model was consistent with historical precedent, defined by increasing the size on the right side of the cup and then gradually decreasing the size as the handle progressed. As for timing, the rule could be resolved in the next couple of days.

In the path of the measured move target, there is a 38.2% Fibonacci retracement of the April-May decline at $1,153. A lower four-hour 200 SMA at $1.27 will be a challenge, followed by a 50% retracement at $1,307 and a 61.8% retracement at $1,462.

4 hour chart XRP / USD

4 hour chart XRP / USD

Forecasts change if XRP price closes below the four-hour 50 SMA at $0.957. This could point to another test of the $0.800-$0.850 price range that has acted as constructive support against the massive selling since the May 19 low.

Despite starting the week with a massive 15% gain, some of Ripple’s on-chain metrics still lag behind the price of XRP.

Yesterday, Ripple’s Daily Active Address (DAA) fell to 8,098, down 83% from the April 12th peak at 49,657. Moreover, it is the lowest level since the beginning of December 2020, revealing a noticeable contraction in the daily interaction with the coin. As the chart below shows, previous highs were usually supported by the headline’s bullish activity.

XRP Daily Headlines - Santiment

XRP Daily Headlines – Santiment

A similar message is written by Ripple’s Network Growth (NG). The number of new addresses interacting with the coin per day decreased from 12,373 on April 19 to 3,172 as of May 31, which is a 73% drop. In addition, network growth has been declining since May 10.

XRP’s rebound since the breakout from a simple inverted head and shoulders pattern, including a 15% gain on May 31, has not been matched by a slight surge in the activity of the Ripple network. It is an obstacle as the price of XRP is trying to overcome the psychologically important $1.00 level on a perpetual basis.

XRP Network Growth - Santiment

XRP Network Growth – Santiment

Based on two on-chain metrics, it is clear that XRP’s price strength has not been matched by an improvement in the underlying support. It could change quickly, especially if Ripple extracts itself from the influence of the dominant $1.00 magnet and continues to succeed in the case of the SEC.

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