XRP is demonstrating strength by maintaining its position above crucial support levels, yet the path towards a breakout remains uncertain. Although momentum from the trendline inspires optimism, bearish divergences on higher timeframes are raising concerns.
Bearish Divergence Indicates Market Caution
In a recent update, CasiTrades highlighted that XRP has shown some momentum after bouncing off the previously mentioned black trendline. While this level’s respect is promising, the market still faces potential risks. The price confronts significant resistance at $3, which is essential for confirming the initiation of a new bullish trend. Until this level is surpassed, downside risks are prevalent, with $2.79 (0.5 retracement) and $2.58 (0.618 retracement) identified as key support zones.
Additionally, the price movement from the trendline seems to be forming a distinct ABC corrective pattern rather than a 5-wave impulsive rally. The price action has already rejected the targets for the C-wave, and bearish divergence has been identified on the 4-hour chart. This combination of elements does not align with typical characteristics expected at the onset of a genuine Wave 3 breakout.
Currently, on the 1-hour RSI, XRP is testing the lower support trendline, which CasiTrades is diligently observing for signs of the next movement. The critical level to watch is $2.69. Ideally, XRP should avoid dropping below this zone, as this would necessitate a reset of the wave count and alter the overall outlook.
A retest of $2.58 remains plausible and might still act as a springboard for a more substantial bullish movement. The overall situation indicates that XRP is at a crossroads: successfully breaching resistance could trigger a much-anticipated rally, while failure could jeopardize the bullish structure entirely.
XRP Support Levels Remain Strong as Momentum Increases
CasiTrades pointed out that XRP’s support levels are holding steady for the time being, and the market continues to await one of these pivotal zones to generate the momentum necessary to overcome resistance. In the absence of a significant push, the price may remain within its current range while exploring lower levels.
The analysis suggests that a genuine Wave 3 breakout will be confirmed only when XRP decisively surpasses major resistance levels at $2.79, $3.00, and $3.25. These barriers must be cleared promptly to avoid repeated rejections, which would indicate weakness and increase the likelihood of further downside testing.
CasiTrades also recommended keeping a close eye on Bitcoin’s movements for broader market alignment, along with monitoring for signs of bullish divergence forming during the next pullback. Once that momentum is observed, XRP may finally be poised for the breakout that traders have been eagerly awaiting.
