NOIDA (CoinChapter.com) — Ripple (XRP) price has been downtrend since March 12, paring nearly all of its weekly gains following a bullish rally at the beginning of the week.
The Ripple token has attracted some investor interest lately following rumors of an XRP ETF in the works. However, with no substantial proof of it happening, the hype has failed to fuel XRP price rally. Moreover, the XRP/BTC pair has also been in a downtrend after spiking about 19% on March 11.
A spike in the XRP/BTC pair would suggest traders are rotating from Bitcoin to altcoins in order to either diversify or for greater profit potential in the short term. However, with the BTC price correcting lately, market participants are likely buying the dip, indicating lesser interest in the Ripple token.
XRP Seeks Bullish Cues From Technical Pattern
Meanwhile, XRP price has formed a bullish technical pattern called the ‘Ascending Triangle.‘
A horizontal trendline connecting swing highs and an ascending trendline connecting swing lows form an ascending triangle pattern. Volume helps determine whether a breakout is strong.
Interestingly, XRP’s price action within the triangle appears to be testing the resistance level multiple times, indicating a buildup of buying pressure.
Under ideal conditions, buyers would enter the market as the trendlines close the gap. As a result, the token’s price would push above the horizontal resistance with heavy volumes.
Per the rules of technical analysis, the price target for a breakout is equal to the triangle’s height at its thickest point. If the triangle pattern pans out, XRP price has a theoretical price target near $1.62, a spike of over 161% from current levels.
Bulls Struggling To Hold Above EMA Support
XRP bulls are trying to defend the 20-day EMA (red wave) dynamic support level as bears continued booking profits. After the recent downtrend, it is possible that some of the selling pressure might be coming from traders jumping ship following the Ripple token’s 20% rout since March 11.
If bulls manage to arrest the downtrend near the EMA trendline and start a rally from there, XRP price could rise to the resistance 0.618 Fibonacci resistance near $0.66. Moreover, flipping the immediate resistance might help the Ripple token rise to the resistance near $0.706.
On the other hand, a continued downtrend would find XRP price testing the 100-day EMA (blue wave) support near $0.59. Breaching the EMA support could force the token to drop to the support near $0.545 before recovering.
The relative strength index for XRP remained neutral, with a score of 51.03 on the daily charts.
