The winds of change are whispering a cautionary tale to cryptocurrency investors. While many grew optimistic following Ripple’s partial victory against the U.S. Securities and Exchange Commission (SEC), some analysts are now suggesting XRP’s price could drop by a staggering 40% by September. Such a drastic price adjustment, if realized, would no doubt send ripples (no pun intended) through the broader cryptocurrency market.
The recent bullish flutter surrounding XRP, gained momentum from the aforementioned case, leading some market watchers to anticipate a price surge as high as $15 in the forthcoming months. However, such optimism might currently face a reality check through a method known as fractal analysis. This analytical instrument has been emboldened by patterns seen in XRP’s recent candlestick and price momentum trends. It suggests that just as history has a knack of repeating itself, so too might there be a considerable market correction heading our way.
In the second quarter of 2021, certain market signals preceded a 65% price drop in XRP’s value. Now, these signals are blinking again on many analysts’ screens. The multi-year descending trendline resistance and an “overbought” relative strength index (RSI), are ganging up together yet again. These teamed up earlier to limit XRP’s upside since January 2018 and are now gearing up to place a potentially heavy hand on the scale, tipping it towards a market correction.
As it stands, XRP’s price is projected to drop toward the lower trendline support, settling near $0.52 by the time the calendar flips to September. That’s a sharp dive of approximately 40% from current price levels and could have ramifications for investors, traders, and the market at large.
Where the scepticism parts the clouds, there are some rays of hope. The downside target aligns closely with XRP’s 50-week exponential moving average (50-week EMA), suggesting a potential bounce when it hits this level. The bounce at this level was previously noted during the price decline in Q2, 2021, which offers some solace amidst the gloom
So, as we approach the dog days of summer, not everything may be looking up for XRP and its investors, depending on how closely history decides to repeat itself. Still, it’s worth noting that in the topsy-turvy world of cryptocurrencies, things can change faster than a shooting star. Therefore, while the fractal analysis rings a cautionary bell, it’s always prudent for investors to conduct their own research to make informed decisions in this dynamic market.
Source: Cointelegraph
