XRP price looks poised to confirm a bullish reversal setup in the coming days, which could potentially drive a rally to nearly $4.
Summary
- XRP price is down 20% from its July high.
- Signs of a bullish reversal have formed on the daily chart.
According to data from crypto.news, XRP (XRP) was trading at $2.86 last check on Wednesday, Oct. 8, down 4.5% over the past 24 hours and nearly 20% lower than its year-to-date high of $3.56 reached in July.
XRP’s price took a hit amid a broader market sell-off, triggered by the ongoing U.S. government shutdown and some profit-taking by investors. Bitcoin (BTC), the market leader, fell below the $122,000 support level, dropping 2.5% over the past 24 hours. Ethereum (ETH) also slid 5.5%, while other major altcoins, including XRP, Solana (SOL), Dogecoin (DOGE), and TRON (TRX), declined between 4% and 8% as bearish sentiment rippled across the crypto market.
Adding to the pressure, XRP was caught in the fallout of a $605.9 million liquidation sweep across the crypto market yesterday, most of which came from long positions. When exchanges force-close longs, it typically triggers a cascade of selling, dragging prices lower across the board.
Despite the recent pullback in XRP price, its technical setup hints at a contrary scenario ahead. Chart indicators suggest the token is on the verge of confirming a bullish reversal pattern, a move that, if validated, could pave the way for a strong rebound in the days ahead.
On the daily chart, XRP has been trading within a descending triangle pattern that has been forming since early July. The setup, which is characterized by a series of lower highs converging toward a flat support zone, indicate that sellers have largely been in control over the past few months.
While descending triangles are typically viewed as a bearish continuation pattern, a breakout above the upper resistance line often points to a bullish reversal with momentum shifting from bears to bulls.
As of press time, XRP was hovering 5% below the key breakout level at $3. If the breakout takes place, it would confirm the reversal if buyers manage to push through.
However, momentum indicators such as the MACD and RSI were sitting near neutral levels, hinting that some consolidation could be ahead of any breakout attempt.
For now, the next immediate resistance for XRP lies around $2.90, aligning with the 61.8% Fibonacci retracement level. A confirmed breakout above $3 could open the door for a run toward $3.93, a target derived by projecting the height of the triangle from the breakout point.
When writing, the market sentiment around XRP was positive, a shift from negative seen just a day earlier. This renewed interest likely came from holders who are likely expecting the first spot XRP ETF to be approved soon, once the US shutdown ends.
To date, at least 7 ETF issuers, including Grayscale and 21Shares among others, have filed to launch such products, with the latest application coming from GraniteShares, which filed for a 3x XRP ETF on Oct. 7.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
