XRP has passed Tether in terms of market capitalization after a colossal price explosion in the past seven days, gaining more than $14 billion. The digital asset had a wild run in the past four days after being flat for almost two years.
The XRP/BTC pair has broken several resistance levels in less than 100 hours putting the RSI at levels not seen since December 2017. Despite this massive price increase, XRP is still down around 82% since its all-time high at $3.84.
For comparison, Bitcoin is only down 7% since the all-time high and Ethereum around 58%. On the weekly chart, XRP has confirmed an uptrend after establishing a clear higher high now. The digital asset has cracked multiple resistance levels in a row but some investors remain cautious.
$XRP – probably walking into a freight train here, but I’m entering some shorts on #ripple. ..to much euphoria…https://t.co/V5rbYtE8eN pic.twitter.com/tJdMUNMI0j
— Big Chonis Trading(@BigChonis) November 23, 2020
Big Chonis, a popular cryptocurrency trader and analyst has recently stated that he is looking to enter a short on XRP as there is ‘too much euphoria’. Of course, the tweet was met with a lot of criticism, especially after the digital asset had another price move towards $0.60.
Is XRP price headed into a correction?
A significant correction seems very likely for XRP considering the magnitude of the bull move. On the 3-day chart, the RSI is greatly overextended at 90.5 and inching closer to the highest level ever at 94.35 which was established on January 1, 2018.
Drawing Fibonacci Retracement lines, we can determine the most likely support levels on the way down. It seems that $0.50 will be a significant support point as it also coincides with the 0.236 Fib and it’s a psychological level.
Further down the line, the $0.382 level at $0.425 would be the next significant level. A breakdown below this point would be notably bearish and could be seen as a reversal point for XRP.
It’s unclear what’s driving XRP price in the past few days but the digital asset seems unstoppable for now. Can we see XRP hit $1 before retracing?
