With XRP losing the $3 support amid a broader cryptocurrency market sell-off, an analyst is projecting the asset is poised for a notable price move based on technical indicators.
On the 12-hour chart, XRP has formed a “Bollinger Bands (BB) squeeze,” a pattern historically linked to sharp price movements in either direction, according to an analysis by prominent cryptocurrency trading expert Ali Martinez in an X post on January 27.
XRP price analysis chart. Source: TradingView/Ali_charts
The squeeze typically occurs when the Bollinger Bands narrow significantly, a volatility-measuring technical indicator.
Based on the analysis, the upper Bollinger Band, positioned near $3.50, signals a potential bullish target if XRP embarks on an upward trend. Notably, the $3.50 level has recently served as a major resistance point for the token, which is seeking to claim a new record high.
On the downside, the lower Bollinger Band sits around $2.80, indicating a possible bearish continuation if XRP breaks below this mark.
What next for XRP’s price
If the $3.50 resistance barrier is breached, XRP could hit $4 with Martinez previously emphasizing that $4 remains a plausible target for the short term.
Meanwhile, as the market continues to digest optimism following the election of Donald Trump, whose policies are perceived to impact the crypto sector positively, some analysts speculate that XRP could aim for values above $5 during the current cycle.
As reported by Finbold on January 22, cryptocurrency analyst MikybullCrypto observed that XRP is trading within an ascending channel, suggesting the possibility of reaching $8.
MikybullCrypto noted that breaking resistance near $3.20 could make this record high achievable.
XRP fundamentals
Beyond technicals, XRP has underlying potential from regulatory developments. In this case, the XRP community is awaiting the Securities Exchange Commission (SEC) meeting on January 30, hoping to progress in the Ripple case, including a potential dismissal or settlement.
Additionally, there is anticipation around the approval of an XRP-focused exchange-traded fund (ETF), which could attract institutional capital.
At the same time, reports indicate that the Chicago Mercantile Exchange (CME) Group is preparing to introduce futures contracts for XRP and Solana (SOL), pending regulatory approval. These contracts are expected to include both standard and micro-sized offerings.
XRP price analysis
At the time of reporting, XRP was trading at $2.79, reflecting a drop of over 10% in the last 24 hours and a 14% decline over the past week.
XRP seven-day price chart. Source: Finbold
In the short term, XRP shows potential for price swings, with volatility at 15%. Meanwhile, long- and short-term outlooks remain bullish as the token trades above its 50-day Simple Moving Average (SMA) of $2.45 and its 200-day SMA of $1.12.
For a recovery, it is crucial for buyers to regain control and push XRP above the $3 level. However, a potential price drop remains on the table, as XRP’s 14-day Relative Strength Index (RSI) of 67.19 suggests it is nearing overbought territory.
Featured image via Shutterstock
The post XRP set for a ‘significant price move,’ according to expert appeared first on Finbold.