XRP (XRP) price has recovered from its low of $1.76 reached on Feb. 3, but it’s still trading below a key resistance level. Will XRP’s price drop further in the coming days?

XRP, Markets, Tech Analysis, Market Analysis, Altcoin Watch

XRP/USD daily chart. Source: Cointelegraph/TradingView

XRP price needs to reclaim the 50 SMA

Last week’s crash in XRP price saw it breach the 50-day simple moving average (SMA), which historically had acted as strong support since Nov. 10.

Related: XRP futures open interest drops 37% — Are altcoin traders jumping ship?

Why it matters:

  • Historically, reclaiming this trendline has preceded major XRP price rallies.

XRP, Markets, Tech Analysis, Market Analysis, Altcoin Watch

XRP/USD daily chart. Source: Cointelegraph/TradingView

  • On Nov. 10, 2024, XRP rose above the 50-day SMA after trading below it for 30 days. This preceded a 520% rally in XRP price.

  • Zooming out further, XRP rose above this moving average in July 2024 and August 2024, preceding 35% and 29% rallies, respectively.

  • XRP price could see another similar rally if it reclaims this trendline.

“XRP eyes a breakout” as the price tests $2.40 support, said pseudonymous analyst  MackAttackXRP in their latest analysis on X, adding that a move above the 50-day SMA  “could signal a strong rally” on the upside.

“Long-term XRP outlook is that XRP trades between $1.20-$4.20.”

XRP bear flag hints at $1.70

XRP, nevertheless, remains in a bearish continuation pattern that indicates a potential correction ahead despite the ongoing consolidation.

Key points:

  • XRP is trading within a bear flag pattern, indicating the possibility of continuing with the downward momentum if key support levels don’t hold.

XRP, Markets, Tech Analysis, Market Analysis, Altcoin Watch

XRP/USD daily price chart. Source: Cointelegraph/TradingView

  • The bull flag developed after XRP’s rally from $3.13 to a local low of $1.76 between Jan. 31 and Feb. 3.

  • The consolidation within the bear flag has XRP trading in an ascending parallel channel, with today’s recovery bounding off critical support levels, including the lower boundary of the flag at $2.34.

  • A breakdown of this level could trigger another price crash.

  • The bear flag’s downside target, derived from the height of the previous drop, is approximately $1.70, representing a 30% downtick from the current price.

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.