XRP may be warming up for a price explosion similar to the November 2024 rally, as its Bollinger Bandwidth slumps to historically low levels.
While XRP has continued to consolidate after the correction from $3.4 in mid-January, current market indicators suggest it may already be on the verge of another leg up. Notably, market analyst Mr. Xoom called attention to one such indicator in a recent analysis.
The analyst highlighted XRP’s Bollinger Bandwidth on the daily chart, which has continued to collapse or tighten over the past few months.
“Every time we’ve seen this happen, you know what happens next.”
XRP Bollinger Bandwidth Contracts
For the uninitiated, a consistent drop or narrowing of the Bollinger Bandwidth indicates that the underlying crypto token is trading within a tight range, showing market indecision and consolidation.
Historically, such tightening conditions often confirm that the market could witness massive expansion or explosive volatility shortly. For XRP, data from Mr. Xoom’s chart shows a consistent drop in the daily Bollinger Bandwidth, which had slumped to 11.53 at the time of his disclosure.
However, at the time of reporting, this figure has collapsed further to 10.59, a massive crash from the 147.33 peak XRP witnessed in November 2024 amid the impressive uptrend that resulted in a break above the $1, $2, and $3 psychological price levels.
XRP Daily Bollinger Bandwidth | Mr Xoom
Interestingly, XRP saw a similar drop in its daily Bollinger Bandwidth right before the November 2024 explosive surge. Specifically, as XRP consolidated around the $0.5 region at the beginning of Q4 2024, its Bandwidth crashed to 5.81 in late October, one of the lowest levels in 2024.
After this, XRP witnessed the Trump-led explosive run that allowed it to soar from $0.5 in November 2024 to $3.4 in January 2025, marking a 580% rise within three months. As the Bollinger Bandwidth continuously drops toward the October 2024 levels, analysts like Mr. Xoom expect another XRP upsurge soon.
Why XRP is Likely to Break Upward
However, it is important to note that while such a drastic drop in the Bollinger Bandwidth often precedes a sudden spike in volatility, this explosion could either lead to a sharp price uptick or sharp price collapse, depending on the direction of the breakout at the time.
Nonetheless, Mr. Xoom is confident that the breakout would lead to an uptrend, due in large part to the symmetrical triangle structure formed by XRP since it dropped from $3.4 in January. Currently, XRP is already eyeing the upper trendline, which indicates that if volatility returns, a breach above is more likely.
Also, considering the previous upsurge from November 2024, essentially forming a flagpole, the current consolidation resembles a bull flag structure. While this structure has extended for too long to still be considered a bull flag, the preceding uptrend still points to a possible bullish breakout.
If the breakout takes the form of a bull flag upsurge, then XRP could skyrocket to $4.7, considering the flagpole height of $2.4 and the potential breakout point of $2.3. Notably, this would mark a 109% increase from XRP’s current price of $2.24.
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