Key Takeaways
- XRP has been consolidating for nearly three months.
- Prices have gotten squeezed between the $0.80-$0.74 range.
- Such market behavior suggests that a spike in volatility is underway.
Ripple (XRP) appears to be gaining momentum for a breakout as it approaches the apex of a symmetrical triangle on its daily chart. Still, the direction of its trend will be determined after a break of support or resistance.
Ripple Looks Primed for Volatility
Ripple appears to be gearing up for a significant price movement after consolidating for nearly three months. The cryptocurrency market has kicked off Monday’s trading session positively. Bitcoin gained more than 1,000 points in market value while Ethereum surged by 3.67%.
Despite the early signs of optimism, most digital assets remain stagnant without clearly indicating heading next. For instance, XRP’s price action continues stuck within a symmetrical triangle that has been forming on its daily chart since late December 2021.
A descending trendline developed along with the swing highs, while an ascending trendline formed along the swing lows. This consolidation pattern estimates a daily candlestick close outside of the $0.80-$0.74 price range will determine the direction of the trend.
Source: TradingView
Given the ambiguous outlook that Ripple presents, it is reasonable to wait for a decisive break of support or resistance before entering any trade. Breaching any of these hurdles could result in a 39.50% price movement to either $1.12 if bulls take over or $0.45 if bears take the upper hand.
This target is determined by measuring the distance between the two highest points of a triangle and adding it to the breakout point. It is worth noting that XRP remains at risk of securities classification. Even though Ripple has assembled an all-star team of securities lawyers, with Andrew Ceresney, former director of the SEC’s Division of Enforcement, being one of them, a hypothetical “XRP = security” court ruling will not go unnoticed.
The ripple effect of such a decision could lead to a wipeout of many adamant investors.