XRP (XRP) price has recovered from its low of $1.94 reached on Feb. 28, but it’s still trading below a key resistance zone. Will XRP’s price drop further in the coming days?
XRP/USD daily chart. Source: Cointelegraph/TradingView
XRP price must hold above $2.00
Today’s drop in XRP price is part of a correction that began on March 3 that saw the relative strength index (RSI) fall sharply following XRP’s drop from $3.00.
Key levels to watch:
XRP bulls are focused on defending the psychological support at $2.00.
This level has not been broken since Dec. 1.
The RSI is below the middle line at 42, suggesting that the market conditions still favor the downside.
XRP could extend the decline to the recent range low at $1.76 (formed on Feb. 3) and the support level at $1.61, where the 200-day SMA currently sits.
XRP/USD daily chart. Source: Cointelegraph/TradingView
The bullish case for the altcoin hinges on XRP turning the resistance between $2.53 and $2.62 into support.
These levels are also the 100-day and 50-day SMAs.
A close above the 50-day SMA could pave the way for a return to $3.00 or the seven-year high above $3.40.
The XRP liquidation 24-hour liquidation heatmap chart shows that there is a big cluster of bids at around $2.00.
XRP liquidation heatmap. Source: CoinGlass
XRP price runs into resistance at $3.00
XRP bulls are looking to regain their strength after failing to sustain momentum over the last couple of weeks.
XRP’s 66% rally between Feb. 3 and March 2 was stopped by supplier congestion around the $3.00 level.
However, XRP is still validating a bull flag pattern in the weekly timeframe, as shown in the chart below.
The price now rests on support at $2.16 at the upper boundary of the flag.
Related: XRP price risks another 20% drop after ‘Digital Asset Stockpile’ letdown
XRP/USD weekly chart. Source: Cointelegraph/TradingView
However, a bearish cross produced by the MACD suggests that XRP might drop further from the current levels.
As such, if XRP closes below the weekly support level of $2.16, it will drop back into the confines of the flag, where it could continue consolidating for a few more weeks.
As Cointelegraph reported, if the critical $2-level breaks, XRP can drop toward its 50-weekly exponential moving average (EMA) at $1.46, particularly as the hype around the US strategic reserve fades.
“The US government’s commitment to only selling altcoins from its new Digital Asset Stockpile is posing a threat to XRP’s uptrend prospects.“
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
