I am an avid believer in the technology behind Ripple’s XRP cryptocurrency. The XRP token is making bigger moves than any other in the real world, providing a major use case and helping to aid seamless international payments.
I went deeper into the tech behind Ripple’s XRP in The Case For XRP.
A pretty major problem for XRP as an investor is the prices inability to grow in line with the fundamentals. Regardless of all the developments being made, XRP price has been on a steady decline for 2 years now. The question is now, could we be at the long anticipated turning point…?
The Price Action
At the time of writing XRP sits at a very interesting level. I’ve identified a large inverse head & shoulders that bottoms out within a major support area:
The chart above shows the inverse head & shoulders pattern at the bottom of a long-term downtrend. As you can see, price is currently rested between the 61.8 & 78.6 Fibonacci retracement levels in my target reversal region. If XRP manages to sustain an upside move from here, we could very well see an end to the current downtrend.
Trading The Setup
There are two possible ways you could be looking to trade this XRP setup. If you are open to risk and like to go for a more aggressive but rewarding entry, you can take a long position off a reversal signal within the current Fibonacci reversal hotspot. There’s no solid confirmation of a reversal here though – so be safe & trail stop losses.
If you prefer to be risk averse, the best option is to await a climb and break back up to the top of the H&S pattern. From there you can buy a retest with a stop loss beneath support.
Don’t Get Too Excited
It is important not to get too excited just yet. There’s every possibility that XRP could drop beneath the reversal region, and continue rolling to the downside to meet even lower prices. When we invest – especially in an infant market like crypto – our capital is at risk, so don’t go putting down money that you can’t afford to lose.
Trade safe & manage risk!