XRP, a prominent crypto specifically designed and leveraged for international payments, has sparked speculation of a potential price surge. Charting Guy (@ChartingGuy), a well-respected crypto analyst, recently presented an analysis highlighting a technical indicator that historically preceded significant XRP price movements.
The indicator in question is the Bollinger Bands (BBs), a popular volatility measurement tool. The Bollinger Bands consist of an upper and lower band surrounding a moving average, with the width between the bands reflecting market volatility. A wider band signifies higher volatility, while a narrower band indicates lower volatility.
$XRP monthly bollinger bands are now the tightest they’ve ever been in history‼️
0.70 for the width
the tightest it got before this was 0.73 in 2017.. 1 month before 📈🚀
probably nothing.. pic.twitter.com/SDk8Q2jj3F
— Charting Guy (@ChartingGuy) April 17, 2024
Read Also: Amid Bullish Signals, Analyst Pinpoints Key XRP Resistance and Support Levels To Watch
Charting Guy’s analysis focuses on the monthly XRP Bollinger Bands, which have contracted to their tightest level since February 2017, reaching 0.70. This historical tightness is particularly noteworthy because the previous instance of such narrow bands, in February 2017, was followed by a dramatic price increase.
In that period, XRP skyrocketed from $0.005 to an all-time high of $3.84 in January 2018, rising over 65,000% in under a year, a feat other analysts are confident XRP can achieve in this bull cycle.
Volatility Squeeze and Breakout Potential
The narrowing of the Bollinger Bands suggests a period of compressed price movement, often referred to as a volatility squeeze. This squeeze can precede a breakout, where the price decisively moves in one direction after a consolidation period.
In XRP’s case, the historical precedent and the upward slope of the 20-day Simple Moving Average (20 SMA) hint at a potential breakout to the upside.
The 20 SMA is a technical indicator that calculates the average closing price of an asset over the past 20 days. A rising 20 SMA suggests an uptrend, as the average daily closing prices increase.
We are on twitter, follow us to connect with us :- @TimesTabloid1
— TimesTabloid (@TimesTabloid1) July 15, 2023
Read Also: Top Trader Says XRP Is Ready For another Leg Up That Will Outperform Bitcoin. Here’s the Target
Market Sentiment and Important Considerations
While Charting Guy’s analysis highlights a potentially bullish signal, it’s crucial to acknowledge the presence of countervailing factors. The cryptocurrency market, as a whole, is known for its inherent volatility.
Geopolitical tension can also significantly impact market sentiment and price movements. Additionally, the ongoing lawsuit between Ripple and the U.S. Securities and Exchange Commission (SEC) adds another layer of uncertainty.
However, the technical indicators are pointing toward a massive move for XRP soon. Other experts have also weighed in on XRP’s potential price after the Bitcoin halving, and all signs point toward a bright future for the digital asset.
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