- Ripple’s XRP shows signs of a potential significant price move due to the tightening Bollinger Bands, a technical indicator suggesting low volatility.
- However, market sentiment and upcoming events, such as the US government’s Bitcoin transfer and Ripple’s token release, could influence its price trajectory.
XRP’s Tight Bollinger Bands Suggest a Potential Large Price Movement
Ripple’s XRP has been on a rollercoaster ride lately, catching the eye of investors and analysts alike. A key technical indicator, the Bollinger Bands, has squeezed tighter than ever before, signaling that a significant price move could be on the horizon.
XRP Bull Run on the Horizon?
Ripple’s XRP started the month strong, with its price surging from under $0.40 to over $0.63 in a few short weeks. However, the momentum faltered in mid-July, causing the price to retrace below $0.55 before climbing back to around $0.60, where it has consolidated in recent days.
One X user has noted that the price could skyrocket based on a historical pattern indicated by the monthly Bollinger Bands, which have squeezed more tightly than ever. Introduced by John Bollinger in the early 1980s, this technical analysis tool measures market volatility and potential price movements. When the bands tighten, it indicates prolonged low volatility, often preceding a significant price move in either direction.
Earlier this month, another X user highlighted the squeezing bands, recalling XRP’s previous price rallies in similar scenarios. At the time of the comment, XRP was valued around $0.44, and a week later, it surpassed the $0.60 mark.
Keeping an Eye on Technical Indicators
While the Bollinger Bands are a crucial indicator, they’re not the only metric worth observing. The Relative Strength Index (RSI) is another vital tool that measures the speed and change of price movements, indicating whether an asset is overbought or oversold. The RSI ranges from 0 to 100, with a reading above 70 suggesting a potential correction. In recent weeks, XRP’s RSI has hovered below this level, currently around 47.
Another X user, Mikybull Crypto, believes XRP’s price could be set for an uptick, citing significant technical signs reminiscent of 2017, which was followed by massive gains.
Market Sentiment and Upcoming Events
Despite these promising technical indicators, current market sentiment could play a significant role in XRP’s near-term performance. The broader crypto market has declined following the US government’s decision to transfer around $2 billion worth of its Bitcoin holdings to another wallet, possibly preparing for a sale. This move has introduced negative sentiment, potentially suppressing the valuation of numerous digital currencies, including XRP.
Additionally, Ripple will unlock a billion XRP at the start of August, increasing the circulating supply. This monthly practice is part of Ripple’s strategy to ensure a transparent release of its holdings. Given its predictability, it is unlikely to cause substantial price swings.
While technical indicators suggest that XRP could be poised for a significant move, market sentiment and upcoming events may influence its trajectory. Investors should remain cautious and stay informed as the situation unfolds.
