Ripple (XRP-USD) on the XRP/BTC pairing is approaching a key level of support at 0.00006357- an area where price has seen resistance, support, and various role reversals dating back to 2017. This analysis piece sheds some light on the expected price scenarios as we head into the 2nd half of April 2019.
As with other altcoins, we are seeing a pattern where Ripple price action is being dominated more by activity from BTC as opposed to inherent fundamentals of the altcoin itself. This is, however, only partly true on XRP. While the impact of BTC strength cannot be discountenanced, it must also be said that a variety of contradictory news releases are not doing much for XRP's push to become one of the top cryptos.
On one hand, Resona Bank, one of the main partners in the development of the xCurrent-based cash transfer app known as Money Tap, has withdrawn from a Ripple partnership. On the other hand, we also have news of regulatory approval from the New York Department of Financial Services, which has granted a license to Ripple's partner and crypto exchange Bitstamp. This approval will also allow Bitstamp to offer XRP's cross-border payment products. So, while it is a mix of good and bad news for XRP, BTC will have a little bit of a role to play in XRP's price in the weeks to come.
The technical play for XRP/BTC starts on the weekly chart, where the price action is nearing a critical support level (0.00006179), where price has found resistance and then support and role reversals have occurred in the past. However, the weekly candle closed without breaching or breaking below the support line. Selling volumes continue to remain strong.
We step down to the daily chart, where the chart has been compressed to show all previous support and resistance areas, with particular reference to the key price level under consideration.
The week which opened on April 15, 2019, will, therefore, be a critical week, as the market will watch to see if prices will bounce from here, or whether a break to the downside will occur.
Trade Scenario 1
The key support area of 0.00006179 remains intact and will serve as the key reference area for the week. The 1st scenario could see prices taking a bounce from this support level. Price rebound is likely to occur if BTC starts to experience a general selloff, and if there is more positive news for Ripple. We must also take cognizance of the diminishing selling volumes seen on the daily chart, which could be a sign that selling pressure has started to wane.
However, buying volumes need to come into play for any upside bounce to have some real effect. We need to watch the price action for the week and see if more open interest on the buy side as well as more buying volume will hit the market.
Trade Scenario 2:
Further strengthening of BTC prices could present another opportunity for XRP/BTC to attack the current support level and put it under pressure. This would need some help from some bad news on XRP and possibly more selling volume to see the support broken to the downside.
The long-term, mid-term and short-term outlook of the TRX/USD pair is:
- Long term - neutral
- Mid-term - neutral to bearish