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Ripple Faces Resistance at $0.64 and Declines Towards Key Support
Ripple has recently seen a notable increase in selling activity near the $0.64 resistance level, resulting in a significant drop toward an essential support zone around the 200-day moving average, currently at $0.54. The pressing question now is whether this decline represents just a short-term adjustment or if it marks the onset of a deeper bearish trend.
Analysis of the Daily Chart
A thorough analysis of Ripple’s daily chart indicates that the recent upward movement faced substantial resistance at the critical $0.64 level, leading to a phase of lateral price action. During this consolidation, a prominent bearish divergence emerged between the price action and the Relative Strength Index (RSI). This divergence was followed by a significant drop of approximately 17%, pushing the price down to a vital support area.
This support area includes the key 200-day moving average at $0.54, which is serving as a robust support level. There is a possibility that this zone contains enough demand and buying interest to support the price. If XRP can hold above the $0.54 mark and initiate a recovery, it would imply that the recent downturn is merely a correction, allowing the overall bullish trend to continue. In such a case, buyers would likely aim to retest the $0.64 resistance and potentially reach even higher price levels.
Conversely, if the price falls below the 200-day moving average with strong selling pressure, it could signal a shift towards a bearish trend. This scenario could expose Ripple to further declines, with the next significant support likely found around the 100-day moving average at $0.51 or potentially lower. As of now, the price is showing signs of attempting to trend downward.
Insights from the 4-Hour Chart
Examining the 4-hour chart reveals that after experiencing heightened selling pressure near the pivotal $0.64 level, Ripple’s price initiated a notable bearish movement, breaking below the lower boundary of an ascending wedge pattern. This development indicates a strong seller presence in the market, suggesting the potential for ongoing bearish retracements.
Currently, the price has reached a significant support area around $0.54, where buying pressure may potentially emerge in the near future. However, if sellers succeed in driving the price below this critical support level, a long-squeeze scenario could unfold, further enhancing the bearish trend. In this bearish outlook, sellers would likely target the price range between the 0.5 ($0.51) and 0.618 ($0.48) Fibonacci levels.
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