All cryptocurrencies have suffered over the past few days, but XRP’s performance has been especially poor.
From its $10,100 peak established late last week, Bitcoin is down 13% as of the time of this article’s writing.
XRP, on the other hand, has shed more than 18% over that same time frame, underperforming most of its altcoin ilk.
It is an underperformance that has a top analyst fearing a deeper retracement in the coming weeks. In fact, the trader suggested that there is a possibility that the altcoin retests the price zone around the “Black Thursday” lows.
XRP Prints Bearish Technical Signs
Although XRP was hold above the $0.21 range as indicated below for an extended period of time, the recent drop broke the technical support.
Nik Patel — a prominent cryptocurrency trader and technical analysis author — explained that the market structure for XRP has “turned bearish” after the loss of the level of support.
“I am particularly interested in the highlighted area from which market structure has recently broken and turned bearish. This break and turn occurred from an important area also: the 200-day moving average,” he explained, referencing the chart below.
XRP price chart shared by Nik Patel in the latest edition of his “Market Outlook” series.
Patel elaborated that should XRP continue to be rejected from the “underside of this area,” the $0.21 range, he expects a “swift move below $0.175.” After that, he wrote, there is likely to be an eventual retest of the range lows at $0.125, the lows the cryptocurrency reached during the “Black Thursday” crash in March.
Along with the bearish outlook for XRP’s trading pair against the U.S. dollar, the analyst shared similar skepticism for the altcoin’s performance against Bitcoin.
All Eyes on Bitcoin
Fortunately for XRP holders, the cryptocurrency could be saved by a rallying Bitcoin. Altcoins, after all, have a trajectory closely tied to that of the leading cryptocurrency.
Analysts are currently charting a bullish medium to long-term outlook for BTC, citing both technical and fundamental factors.
Galaxy Digital chief executive officer Mike Novogratz held his long-standing bullish tone on the leading cryptocurrency in a recent interview with CNBC’s “Fast Money” segment.
He asserted that with all of the stimulus by governments, along with the record amount of liquidity operations by central banks, Bitcoin could climb towards $20,000 by the end of the year.
Along with the positive macro outlook, Novogratz added that Paul Tudor Jones, the legendary macro hedge fund investor, entering the Bitcoin space is especially notable.
In terms of technicals, a top trader recently noted that Bitcoin’s current weekly chart is looking exactly as it did at the start of 2019’s bull rally.
Both periods highlighted in the chart below show seven weeks of consecutive gains, followed by a “Doji” candle. BTC repeating what it did in the past will see it rally over 150% in the next few months.
Chart from @GalaxyBTC (Twitter handle) that depicts the similarities between Bitcoin’s recent rally and that seen at the start of the 2019 bull run.
Photo by Brad Bang on Unsplash