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The XRP price action has produced notable volatility over the past eight weeks intense trading activity Haven’t seen her in over six years. After the US presidential election on November 5, 2024, where Donald Trump won, the value of XRP increased by more than 400%, peaking at $2.90 on crypto exchange Binance on December 3.
However, the XRP price has seen a decline over the past week. Interestingly, this XRP price correction appears to be following an ABC correction path technical analysis indicates a further decline before the next stage up.
XRP price with ABC correction
The XRP price correction since reaching the $2.9 mark is highlighted by an ABC pattern that is nearing its end. Specifically, this pattern consists of two downtrend waves A and C and a small uptrend wave B in between.
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According to the price chart below, that of the XRP/US Dollar pair on a 4-hour candlestick timeframe, the first downward wave A started after the bottomed out at $2.9. $2.16 on December 5, representing a 25% drop in two days. From there it continued with a small uptrend wave B, which indicated that the bulls were still in action. Wave B culminated with a lower high at $2.65 on December 9, translating to another 22% increase in four days.
Since reaching this lower high, XRP price has initiated a new correction path over the past 24 hours, giving rise to the idea of corrective wave C now in action. If a similar trend to that of wave A were to occur, we could see the XRP price correct by another 25% from $2.65, which would put the bottom just below $2 before another bounce shows up. This makes a lot of sense, considering that the $2 price level serves as a psychological threshold that could prevent the bulls from breaking below it.
Bullish Impulse Suggests Next Move to $2.8 and Beyond
At the time of writing, the XRP price is trading at $2.19 and has fallen almost 10% in the last 24 hours. The ongoing wave C, which is the final part of the ABC correction pattern, could continue in a downtrend until it reaches resistance at $2. Technical indicators support this outlook, especially the Relative Strength Index (RSI).
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The RSI has fallen below its overbought zone for the first time since November 10. This signals a cooling of the bullish momentum that pushed XRP to its recent highs, paving the way for the correction wave C.
Despite this setback, market dynamics persist suggest a jump of the $2 level is a strong possibility. Such a recovery could mark the beginning of a renewed bullish wave and push the XRP price towards $2.80 and higher. This scenario aligns with the broader outlook for XRP investor optimism still lingers with regard to clarity of the regulations after a new US presidential administration will come to power in January 2025.
Featured image created with Dall.E, chart from Tradingview.com