The XRP (XRP) price is showing signs of a potential rally of over 20% in the coming weeks based on a classic bullish continuation setup. This setup is known as the bull flag pattern, which occurs when the price consolidates within a parallel channel after a strong uptrend. The pattern is confirmed when the price breaks above the upper trendline with convincing volumes and rises by a similar height to the previous uptrend.
Indecisiveness Among Traders
As of Nov. 26, XRP was trading above the upper trendline of its bull flag pattern, although volumes were relatively weaker. This indicates a weaker conviction among traders about XRP’s bullish continuation. The duration of this indecisiveness could potentially test the upper trendline of the flag pattern as support, leading to a decline towards $0.59. This price level coincides with a historical support level and the 50-day exponential moving average (EMA).
Potential Upside Target
If the bull flag scenario holds and is characterized by a high-volume rebound from the upper trendline, XRP may climb towards $0.75 in December. This represents a potential gain of over 20% from the current price levels. However, breaking below the flag’s upper trendline would delay the bullish continuation setup and bring the lower trendline near $0.54 into play as the next downside target. This level coincides with the 200-day EMA.
XRP’s on-chain data suggests a bullish sentiment, thanks to strong accumulation among its richest addresses. Addresses with a balance between 100,000 and 10 million tokens, often referred to as “whales,” have purchased $6.82 million worth of XRP tokens over the past week. This indicates their conviction about a price rise in December, which aligns with the bull flag setup discussed earlier.
XRP’s price has experienced a significant increase of nearly 85% in 2023, mainly driven by Ripple’s partial win against the United States Securities and Exchange Commission (SEC). However, the court still needs to decide whether Ripple’s XRP sales to institutional investors violated U.S. securities laws. The trial between Ripple and the SEC is expected to resume on April 23, 2024, and legal experts anticipate a high likelihood of a settlement. Crypto attorney John Deaton believes that any settlement below $20 million would be a 99.99% win for Ripple.
XRP (XRP) shows potential for a rally of over 20% in the coming weeks based on the bull flag pattern and positive on-chain data. Traders should closely monitor the price action and volume dynamics to confirm the continuation of this bullish setup. Additionally, the outcome of Ripple’s legal battle with the SEC may further influence XRP’s price trajectory.