XRP, the fourth-largest cryptocurrency by market capitalization, has flashed a short-term signal that has traders on edge. A “death cross” recently appeared on the XRP hourly chart, indicating that the short-term moving average (typically the 50-SMA) has crossed below a longer-term moving average (the 200 SMA), a technical signal often associated with bearish momentum.
A death cross on shorter time frames, such as the hourly chart, often indicates near-term downside pressure, particularly if supported by volume and broader market weakness. Traders interpret an hourly death cross as a signal to watch for lower lows or possible retests of recent support levels.
According to CoinMarketCap data, XRP’s 24-hour volume is down 41.52% to $2.55 billion. Friday’s market sell-off, which resulted in over $1.16 billion in liquidation, contributed to a decline in trading activity for various crypto assets, as traders sit on the sidelines awaiting the next big move.
What comes next?
The bearish technical pattern follows after XRP experienced four straight days of drop from June 10 to 13, driving prices lower. However, there may be some hope on the horizon. At the time of writing, XRP is showing signs of a mild rebound, up 1.79% in the last 24 hours, currently trading at $2.16.
Another positivity is that the impact of a death cross signal on hourly charts is often short-lived compared to daily or weekly time frames. If buying momentum continues to build, the bearish setup might soon be invalidated.
In this scenario, if the price turns up sharply from its current level and breaks above the hourly SMA 50 and 200 at $2.16 and $2.22, it may continue its upside move, targeting $2.33 and $2.65 next.
The hourly RSI slightly above the 50 mid-point suggests potential short-term range-bound trading. Buyers are anticipated to actively defend the $2 support, as a breach and close below it may send XRP down to $1.61.
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