XRP Price Analysis

The price of the third largest cryptocurrency, XRP, may be poised for a painful decline. Recent months have seen wild price swings, and on the price chart, a head and shoulders pattern has emerged.

Understanding the Pattern

For those unfamiliar, this pattern features three waves of consecutive rallies and declines, with the middle rise and correction being significantly higher than the others. The price chart resembles three hills standing at the “neckline,” which serves as a crucial price support level.

Potential Decline

If the neckline is breached, a decline can equate to the size of the second wave of growth. In XRP’s case, this could mean a 24% correction from the neckline level, currently at $2.

Thus, the bearish head and shoulders scenario suggests a potential drop to as low as $1.50. This won’t happen overnight and is considered the most pessimistic outcome. If a breakdown occurs, the market will likely retest the neckline. Without a bullish reaction, $1.50 may become an inevitable target.

Other Scenarios

Alternatively, XRP could find support at the neckline. If there’s a weekly close at this level, bullish aspirations may be revived. However, a dip below $1.50 is also possible, as it is the next major support level.

Considering that XRP has increased over 500% in recent months, a drop is plausible. Unfortunately, this would erase any hopes for a continued rally, hence the importance of maintaining the neckline.