Ripple [XRP] was trading at $1.89 at the time of writing, having fallen back below the $2 psychological support when Bitcoin [BTC] fell below $90k last week. XRP was still slightly above the January low of $1.81.
A recent AMBCrypto report noted that though spot ETFs were positive and there was evidence of whale accumulation, the market might not be ready for a rebound yet. The derivatives market signaled a risk-off sentiment, as well.
Examining the XRP structure
Source: XRP/USDT on TradingView
The 3-day timeframe’s swing low is at $1.77, a level that has not yet been broken. Yes, all of January’s gains have come undone over the past ten days, but it was still trading within the weekly demand zone highlighted.
The CMF was below -0.05 since December to indicate extended, steady capital outflow. Buying volume and sustained upward price movement were not seen in recent weeks, and the recent retracement did not help the bullish case.
The CMF fell lower from -0.05, and the MFI was also unable climb past 50 on this timeframe. Together, they were a warning to the bulls that more choppy price action was possible.
Rebound from a liquidity cluster
The area just below $2.0 was highlighted as a liquidation cluster that was bound to draw XRP prices lower. This has come to pass. With the liquidity swept, it appears likely that XRP will climb higher.
Bear in mind, the internal structure on the 3-day chart was flipped bullishly after the strong start to the month, despite the subsequent setback.
Why traders should be more patient
Source: CoinGlass
The bias still remains bullish, so long as $1.77 remains unbroken. The liquidation map showed that the area down to $1.80 has a sizeable amount of cumulative liquidation leverage.
XRP might see a deeper dip before recovery. A short squeeze toward $2.05 thereafter appeared highly likely. If bulls could bring in sustained demand, the move has the potential to turn into another strong rally like earlier in the month.
Final Thoughts
- The XRP price dip might not be finished yet, but the longer-term bias remains bullish.
- Traders can remain bullish so long as $1.77 is unbroken. Liquidation levels around $1.80 could beckon XRP lower in the coming days.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
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