During the night, Bitcoin faced severe rejection after attempting to gain significant upward momentum. This instantly led major altcoins such as XRP and Ethereum to fall in tandem, shedding light on a potential underlying weakness in the cryptocurrency markets.
It is important to note that while the latest downward movement of many altcoins may simply be the result of their close correlation with Bitcoin, the ongoing drop in XRP has marked a rejection at a key resistance level, signaling that it may soon see further significant decline.
XRP cancels four days of earnings during the sharp nighttime drop
At the time of writing, XRP is down 3% at its current price of just over $ 0.23, which marks a significant decline from its overnight highs of over $ 0.25 which have been set in conjunction with the Bitcoin rallies up to $ 9,200.
Over a weekly period, XRP is still trading significantly from lows of less than $ 0.21, although the overnight drop wiped out significant gains since last Thursday.
In the short term, it appears that the cryptocurrency has found strong support in its current price regions, and it is highly likely that the fact that it remains above or not above this support lies with Bitcoin.
Previously, analysts had noted that XRP’s two key support levels existed at around $ 0.25 and $ 0.27 respectively, with the latest selloff signaling a sharp rejection at the previous resistance level.
Before last night’s rally and subsequent drop, Galaxy – a famous cryptocurrency analyst on Twitter – told its 60k followers that it’s long on XRP as a break above $ 0.25 could trigger a move to $ 0.30. , but the drop overnight seems to have invalidated this hike.
“XRP shows signs of strength. Break $ 0.25 and it’s show time. $ 0.3 as the first target, “he noted earlier.
$ XRP showing signs of strength.
Break $ 0.25 and it’s showtime.
$ 0.3 as the first target.
I’m long pic.twitter.com/MBOBJl0NbY
– Galaxy (@galaxyBTC) January 17, 2020
Without a firm break above $ 0.27, further losses are likely to be forthcoming
In addition to having to exceed $ 0.25, leading analyst Jacob Canfield also noted that XRP must exceed $ 0.27 to allow for a real change in trend.
“XRP – In a downtrend channel and looking to test the last 2 years of support and ex resistance $ 0.27 cents. Before the massive breakout for $ 3.00. Will they be rewarded for their patience or will we see more or less the same? “He observed.
$ XRP – In a downtrend channel and looking to test the past 2 years of support and ex resistance $ 0.27 cents.
before the massive breakout at $ 3.00.
Will they be rewarded for their patience or will we see more or less the same? pic.twitter.com/m6FqfPpaoM
– Jacob Canfield (@JacobCanfield) January 18, 2020
Since the crenellated cryptocurrency has failed to break through one of these key resistance levels, there is a strong likelihood that it may once again find itself caught in a strong downward trend that puts it back below $ 0.20.
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