The Last Time This Happened, Ripple’s XRP Spiked 650x, Indicator Suggests We Could See a Repeat
Technical analysts are calling attention to a rare signal on the charts that previously preceded an explosive 65,000% rally in Ripple’s XRP cryptocurrency. However, amid mixed fundamental factors, some experts urge patience before going all-in on the potential upside.
According to crypto trader Tony “The Bull” Severino, XRP’s monthly Bollinger Bands – a popular technical indicator measuring volatility – are currently tighter than they’ve ever been in the token’s history. “The last time they were this tight, there was a 65,000% rally that followed,” Severino stated in a recent tweet.
Fellow analyst Dom highlighted the same phenomenon, tweeting “If a breakout is going to happen, it should happen pretty soon. Price just printed the same false break of structure it has in the past.”
For the uninitiated, Bollinger Bands plot two standard deviation lines above and below an asset’s moving average. When the bands squeeze tightly together as volatility declines, it often proceeds a volatile price expansion to the upside or downside. In XRP’s case in 2017, that volatility breakout led to a staggering 650x price surge to new all-time highs.
There Are Reasons to Be Cautious
However, despite the bullish technical signal, there are reasons to be cautious about extrapolating past performance this time around. XRP has repeatedly broken from its typical price structures and trading patterns in recent years amid the token’s struggles.
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Show more +Additionally, investor enthusiasm in XRP itself appears to be waning, with many crypto traders outright dumping their holdings or shifting allegiances to other digital assets. If a bullish breakout does occur, it may lack the overwhelming buy-side pressure needed to fuel an explosive 650% rally.
On the flip side, the clean technical signal could easily be a precursor to an unexpected downside move if market dynamics shift. For these reasons, analysts suggest waiting for clearer fundamental and price confirmation before speculating on XRP’s next major move.
Only time will tell if the stars will align for Ripple’s XRP to reenact its historic 2017 pump or if the cryptocurrency’s glory days are behind it. But this extremely rare technical phenomenon is certainly worth watching.
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