Ripple has gained little today after WTO comments that confirmed the ability of XRP to transform global commerce. Will the gain continue?
Since its decline from the all-time-high, Ripple had its biggest month last September. It gained more than 100% to trade slightly above 0.76. Its trade volume and market capitalization also soared as investor piled up the digital XRP token. There is an expectation that XRP would become an alternative method banks and financial services companies moved money across borders. However, the price of Ripple has now dropped to 0.49 in less than two weeks after the 0.76 September top. The market volume which was about $4 billion in September has also dropped to $500 million as buyers cashed out.
Meanwhile, the World Trade Organization has warned that the Ripple technology has the potential of changing the way global financial system works. WTO admits that, despite the Ripple system is still in a test mode, it could change the way financial institutions transfer money across boarders if it can fulfill its potentials. After this report, Ripple gained 1%. Will this report attract more investors to Ripple and boost investor's confidence on the XRP project?
XRPUSD Technical Analysis and Important Price Levels
In the last update, we expected the drop from 0.76 to retest 0.5 before the rally resumes. There were two scenarios which depended on whether price is supported at 0.5 or breaks below it. The chart below was used.
The chart above shows an advancing impulse wave from 0.245. There are two scenarios. The first scenario assumes the 4th wave of the impulse wave rally has already completed at 0.43 and the rally that followed is wave i (blue) of v (black). If this scenario holds, we will see a re-test of 0.5 (or slightly below) to complete the second sub-wave of wave 5 of the impulse wave rally from 0.245. To validate this scenario, 0.43 is expected to hold firm as a support level. However, if price breaks below 0.43, we might be having wave iv still running with one leg to complete. 0.4 is expected to hold in this case. If this scenario holds, price will stay above 0.37 (with 0.37-0.4 acting as a support zone) and head back upside. A bridge below 0.37 will turn Ripple back bearish, with a dip below 0.245 leading to a new low, a possibility.
Price is currently between 0.62 and 0.43. Above 0.62, price might run to retest 0.76. Below 0.43, price might go toward 0.25 low.
The bullish strong rally in September looks like an impulse wave. The current correction from 0.76 is expected to be the 4th wave if this wave analysis is correct. If price drops below 0.43, it's expected to be minimal and stay above 0.37. A break below 0.37 will likely see price heading to 0.25. If the current leg is held above 0.37, price could rally again to break above 0.62 and 0.76 en-route to $1. On another level, price could be contained between 0.62 and 0.43 for a much longer time to complete a triangle pattern before an eventual breakout.
Where do you think the breakout would happen? Let’s know by your comment below. Don’t forget to share this analysis with people that matter to you.