Ripple's XRP Token Looks Ready to Break OutAugust 31, 2021
- XRP is consolidating within a tight price range.
- A daily candlestick close outside of the $1.17-$1.10 zone should determine where prices are heading next.
- Interestingly, some large whales have been exiting the network over the past few days.
As a new monthly close approach, it appears that volatility is back among the top cryptocurrencies by market cap. Although XRP remains stagnant, the technicals show a high probability of a significant price movement.
XRP Consolidates Before the Breakout
Ripple’s XRP token continues to consolidate within a tight trading range that is getting narrower over time.
The sixth-largest crypto’s price action over the last twenty days appears to have led to the formation of a symmetrical triangle on the daily chart. A descending trend line can be drawn along with the swing highs, while a rising trend line developed along with the swing lows.
As XRP edges closer towards the triangle’s apex, it suggests that a major spike in volatility is about to take place. The measurement of the height of the technical pattern’s y-axis added to the breakout point projects a 31.7% price movement in either direction.
Only a daily candlestick close outside of the $1.17 to $1.10 range will determine where XRP is heading next. A spike in buying pressure that results in a break of the overhead resistance could see the asset rise to $1.55, but losing the $1.10 level as support may lead to a correction towards $0.75.
Despite the ambiguous outlook that the symmetrical triangle presents, data from behavior analytics platform Santiment shows that whales have been booking profits.
The number of addresses holding more than 10 million XRP has decreased by 1.5% over the past three days. Roughly five whales have left the network or redistributed their token within such a short period.
The sudden decline of large investors on the network is a negative sign for a sustainable uptrend, especially when considering they hold more than $11 million worth of XRP. A further increase in selling pressure could push XRP below the underlying support at $1.10, resulting in a 31.7% retracement.
Still, only a daily candlestick close outside the $1.17 to $1.10 price pocket will determine where XRP heads next.
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