XRP USD analysis is carried out on the 1 hour timeframe chart from June 4 till present date. The numbered annotations on the chart are discussed below:
(1) Price action from June 29 till date is considered here to be in a rectangle bottom that is bullish (albeit not 100% of the time), with Ripple (XRPUSD) forming the top of the chart pattern between July 3, 2018 and a Head and shoulder pattern (July 17 to July 18, 2018) forming the second pivot used for the top of the rectangle bottom.
June 29 and July 12, 2018 are pivots used to connect the bottom of the pattern. Price closing below ~$0.43 invalidates the pattern, and implies more bearish action in Ripple (XRPUSD).
(2) Width of the rectangle bottom that can be used for projection on a breakout above the rectangle bottom, and even should price invalidates the chart pattern and closes below it. A breakout above the triangle for example could see Ripple target ~$0.61 by projecting the width directly above the breakout point (assumed here to be $0.52).
(3) Current bullish price channel developing on the 1 hour timeframe since July 20, 2018. It is important to pay attention to the price channel as a break below it could trigger selling, while closure outside the channel could see price return to the top of the rectangle bottom.
The current market action (rectangle bottom) is contained within Ripple’s massive descending triangle mentioned in my previous post, so it is important to keep the bigger picture in mind and also remember that chart patterns can nest inside one another. Therefore understanding what the big picture is for Ripple (XRPUSD) is an absolute must.
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