In crypto trading, history often repeats itself, or at least rhymes. Therefore, it can be crucial to recognize historically important price signals and patterns. A recent technical analysis by Egrag Crypto has done just that in the spotlight such a pattern for XRP, indicating a possible massive price increase.
This analysis is based on the observation of a bullish crossover between the 21 Exponential Moving Average (21 EMA) and the 55 Moving Average (55 MA) on the 2-week chart of XRP/USD. Egrag says: “XRP rockets: 21 EMA and 55 MA signal explosion: let’s decode the XRP trajectory – my focus? Just two crucial weekly candles after the crossover between 21 EMA and 55MA.”
Will XRP Price Rise to $7?
The chart of Egrag Crypto highlights the XRP price movements in the two different scenarios in which this rare bullish signal occurred. The first bullish crossover of the 21 EMA and 55 MA in the 2-week chart occurred in March 2017 (scenario A). Following this signal, XRP price saw “two notable 2-week candles. The first rose about 90%, followed by an exciting 1100% spike,” Egrag noted.
For the second time in XRP price history, the signal flashed in late December 2020. This time, collective upturn of 200%.
According to the crypto analyst, there is a good chance that these scenarios will repeat themselves. “Drawing parallels from previous bullish runs syncs my view with historical data,” Egrag noted.
Notably, Egrag’s chart also shows an ascending trendline, a bullish indicator, which XRP has tested twice, as evidenced by the two green circles in mid-2022 and early 2023. These ticks on the trendline are critical, as they suggest that every touch is a test of support where price finds enough buyers to start a new upward move.
The analyst speculates that XRP could fall a little further to tap the rising trendline for the third time, which could foreshadow a significant price rally. This potential third tick on the trendline is seen as a buying opportunity that could precede a significant price increase.
After this third retest of the trendline, Egrag expects two possible scenarios, based on the bullish crossover of the 21 EMA and 55 MA. In scenario A, the crypto analyst foresees a dramatic rise in the XRP price, predicting a target of $7.00, which would represent a staggering 1,139.35% increase from the current price.
Scenario B suggests a more conservative target of $1.80, which would still be an impressive 218.82% gain. The “No Return Zone”, highlighted in red at the $1.80 level, is just above the target of scenario B. It marks a critical threshold that could either act as a resistance zone or confirm strong bullish momentum if the price remains above that.
Broader market forces
The crypto analyst is also aware that the Bitcoin price traditionally plays a major role in altcoins such as XRP. He therefore notes about current market conditions: “Eyes are on BTC as the majority expect a peak of $48,000-$50,000, possibly followed by a pullback, triggering a widespread alt season. But what’s intriguing? A scenario where BTC skyrockets to ATH, returns and unleashes a truly wild alt season.”
The analyst’s perspective leans towards an initial peak between $7 and $10, followed by a significant retracement, and then an even more substantial rise to the $20 to $30 level. When asked about the size of the expected retracement of the $7-$10 range, Egrag Crypto responded with an “aggressive $1.3-1.5” drawdown.
At the time of writing, XRP was trading at $0.61095.
Featured image from Medium, chart from TradingView.com