XRP reaches range highs, can further gains be expected

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Dis­claimer: The find­ings of the fol­low­ing analy­sis are the sole opin­ions of the writer and should not be con­sid­ered invest­ment advice.

XRP has per­formed incred­i­bly well over the past few days. It has gained near­ly 30% over the past week alone, due to the ral­ly from $0.32 to $0.42.

For a coin ranked 7th on Coin­Mar­ket­Cap with a mar­ket cap­i­tal­iza­tion of $20.16 bil­lion, it was a remark­able surge. Look­ing for­ward, can the bulls keep the momen­tum going, or would the range-bound price action like­ly continue?

XRP- 3‑Day Chart

XRP reaches range highs, can further gains be expected?

Source: XRP/USDT on TradingView

The 3‑day time­frame showed the mar­ket struc­ture to have tak­en a bull­ish turn. The price has formed a range (yel­low) between $0.42 and $0.31.

In August, XRP climbed just above the mid-range val­ue but couldn’t close a 3‑day can­dle above $0.38. At the time of writ­ing the most recent and ongo­ing can­dle looked like it could close above the August highs.

If this were to hap­pen, the D3 struc­ture would flip to bull­ish. Patience could see bulls reward­ed, espe­cial­ly if XRP can suc­ceed in flip­ping the range highs to support.

Yet, until that hap­pens, trad­ing with­in the range might be a safer mind­set for a trad­er. In gen­er­al, a con­tin­u­a­tion of a range hap­pens more reg­u­lar­ly than a strong breakout.

Rationale

XRP reaches range highs, can further gains be expected?

On the dai­ly time­frame, the mar­ket struc­ture has already assumed a bull­ish bias. Yet, this could lull buy­ers into a false sense of secu­ri­ty. A move upward to test the $0.42-$0.45 region for liq­uid­i­ty before a sharp drop could also occur.

The price seeks liq­uid­i­ty, and such a move could force short posi­tions to close at a loss, and also con­vince side­lined traders that a break­out was immi­nent. A plum­met toward $0.36 and $0.34 could force the very same buy­ers to sell at a loss and add fur­ther down­ward momentum.

While this sce­nario could play out, a break­out past $0.42 was what the indi­ca­tors sug­gest­ed. The OBV has formed a series of high­er lows since mid-June and indi­cat­ed steady demand behind XRP. The RSI was also well above neu­tral 50 to show heavy bull­ish momentum.

Conclusion

Which way would XRP lean? A revis­it of the $0.42-$0.45 would be a more like­ly sell­ing oppor­tu­ni­ty as a devi­a­tion above the range, rather than a buy­ing oppor­tu­ni­ty in antic­i­pa­tion of a break­out. That said, the indi­ca­tors showed a bull­ish bias.

To con­clude, the risk-averse trad­er could opt to wait for rejec­tion at $0.42-$0.45. Alter­na­tive­ly, traders who are more com­fort­able with risky con­di­tions can look to enter short posi­tions with­in the $0.42-$0.45 zone, with take-prof­it tar­gets of $0.36, $0.34, and $0.31 and stop-loss above $0.45.

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