A cryptocurrency analyst has pointed out how the next XRP support may be $1.2 if the lower level of the asset’s Parallel Channel breaks down. XRP Is Currently Above A Parallel Channel’s Support Level In a new post on X, analyst Ali Martinez has shared a pattern that has been forming in the 3-day price of XRP. The pattern in question is a Parallel Channel, a type of consolidation channel in technical analysis (TA). Related Reading: Bitcoin Blasts To $92,000, Liquidating $182 Million In Shorts A Parallel Channel appears whenever an asset’s price consolidates between two parallel trendlines. The upper level of the pattern tends to be a source of resistance, while the lower one that of support. Together, the two lines keep the asset locked in the range between them. Either of the levels not holding up can imply a continuation of the trend in that direction. This breakout is bullish when the price breaks the upper level, while bearish in the case of the lower one. Based on how the channel is aligned relative to the graph axes, Parallel Channels can be divided into a few types. The Ascending Channel corresponds to the case when the channel has a positive slope. Similarly, the Descending Channel is the type where consolidation occurs to a net downside. The channel that XRP has been following over the past year falls in neither category, however, as it belongs to the third and simplest case: a Parallel Channel that’s also parallel to the time-axis. This pattern naturally signifies a phase of true sideways movement in the price. Now, here is the chart shared by Martinez that shows the Parallel Channel that the 3-day price of XRP is trading inside: As displayed in the above graph, the 3-day XRP price recently retested the Parallel Channel’s lower level situated at $2. The coin has since rebounded, indicating that support is holding for now. In the scenario that the coin returns to the level and a retest fails, the analyst has noted that the next level that stands out is the $1.2 level. This level and the support line are separated by the same distance as the height of the Parallel Channel. It now remains to be seen how XRP will develop in the near future and whether the rebound will continue to hold. Related Reading: Bitcoin Long-Term Holders See First Uptick Since April Lows: Bullish Sign? XRP isn’t the only cryptocurrency that has been following a Parallel Channel recently. As Martinez has pointed out in another X post, Ethereum‘s daily price has seemingly been trading inside such a pattern for a few years now. XRP Price XRP has shot up alongside the rest of the cryptocurrency sector as its price has recovered to $2.17. Featured image from Dall-E, charts from TradingView.com
A cryptocurrency analyst has pointed out how XRP has bounced off the bottom level of a Parallel Channel and could be headed toward its midway line. XRP Recently Found Support At The Lower Line Of A Parallel Channel In a new post on X, analyst Ali Martinez has discussed about a technical analysis (TA) pattern forming in the 3-day price of XRP. The pattern in question is a “Parallel Channel,” appearing whenever an asset’s price consolidates between two parallel trendlines. Related Reading: Capriole Founder Not Bearish On Bitcoin Despite Headwinds—Here’s Why The upper level of the channel provides resistance to the asset, making tops probable at it. Similarly, the lower line can facilitate bottom formations by acting as a source of support. A breakout of either of these bounds can imply a continuation of the trend in that direction. There are a few different types of Parallel Channels, but the one of interest here is the most basic version: a channel that’s parallel to the time-axis. This type corresponds to a phase of true sideways movement in the price. Now, here is the chart shared by Martinez that shows the Parallel Channel that the 3-day price of XRP has been stuck inside for the past year: As is visible in the above graph, XRP witnessed a failed breakout beyond the upper line of the Parallel Channel back in July. This kicked off a phase of downtrend for the cryptocurrency, which culminated in a retest of the channel’s lower line earlier in November. The coin has since observed a rebound, a potential sign that the support level of the Parallel Channel is holding up. The analyst thinks that the cryptocurrency may now be heading toward the midpoint of the pattern, located at $2.60. From the current price of the asset, a rally to this level would mean an increase of almost 20%. It now remains to be seen whether the coin’s surge will continue, or if it will retrace back to the support line again. Related Reading: XRP Jumps 7%, But Watch Out For Speculative Froth Something that could make the latter scenario more likely is profit-taking from the whales. As Martinez has highlighted in another X post, the large XRP holders carrying between 1 million and 10 million tokens participated in distribution during the asset’s latest recovery surge. As displayed in the chart, XRP whales reduced their supply by more than 180 million tokens (worth $391 million at the latest exchange rate) alongside its 17% price rally. This selloff was only a continuation of the trend from earlier in the month, and could be a potential sign that the sentiment among big-money traders hasn’t changed despite the rebound. XRP Price At the time of writing, XRP is floating around $2.17, down 1.5% over the last 24 hours. Featured image from Dall-E, Santiment.net, charts from TradingView.com