Key takeaways
What does the XRP “death cross” mean for price trends?
The XRP “death cross” is a bearish cross of two popular long-term moving averages. This hasn’t happened yet, but it was about to happen if prices continue to fall.
Do technical indicators show recovery potential?
No, the indicators all show bearish strength, as they lag price action. The current bearish move could reach $2, and if that fails, perhaps as high as $1.61.
Ripple (XRP) whales were in action again, offloading 900,000 tokens in just five days. This compounded the bearish pressure the altcoin was facing as it fell into the $2.2 demand zone and threatened to break out and fall further.
Falling foreign exchange reserves and capital outflows in early November did not represent sufficient demand to absorb the recent selling frenzy.
Failure to breach resistance at $2.7, a key local level, cemented the bearish scenario. Another development could push the sentiment deeper into scary territory.
The importance of the XRP “death cross”
Source: XRP/USDT on TradingView
Moving averages (MA) are a simple but important tool in technical analysis. Some periods are more particular than others, simply because they are frequently cited by analysts and the media. One such pair is the 50-day and 200-day MA pair.
A bearish crossover, when the 50-day MA crosses below the 200-day MA, signals potential bearish momentum. This is the essence of XRP’s “death cross,” with the 50-day MA now approaching a decline below the 200-day MA.
The CMF was at -0.06 at press time, signaling strong selling pressure on XRP. The red bars of the Awesome Oscillator reflect the strengthening of bearish momentum in recent days. It has been below the zero line for almost a month, showing constant bearish momentum.
The A/D indicator has made lower highs over the past three weeks and is steadily falling, another sign of bearish pressure.
Overall, it seemed likely that XRP would fall to the psychological $2 level, and perhaps even further south. The next horizontal high levels to watch were $2, $1.9, and $1.61.
Meanwhile, $2.7 is the highest the bulls need to beat to alter the structure bullishly.
Disclaimer: The information presented does not constitute financial, investment, business or other advice and represents the opinion of the author only.
