XRP Price Enters Neutral State – Implications for Upcoming Rally

A crypto analyst has revealed that XRP has transitioned into a neutral state, suggesting a potential major price rally ahead. He elaborates on how this situation has historically led to significant price increases and explains what the current market trends may imply for XRP’s future.

Key Takeaways

XRP has entered a neutral state, potentially signaling the start of a bull rally.
The pattern from prior market cycles shows a repeated four-phase structure.
A significant price breakout above previous ATHs is crucial for momentum.
Analysts project XRP could reach a new all-time high around $21.5, based on historical Fibonacci levels.

This analysis presents a clear indication for XRP investors as they navigate the current market landscape and consider their strategies moving forward in the cryptocurrency space.

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XRP Price Shifts to Neutral State Indicating Possible Bull Rally

Crypto analyst CW recently provided insights into XRP’s price movements, indicating that the cryptocurrency has emerged from its lowest point and has now entered a neutral phase. This transition is recognized as the initial step towards a broader bull rally, with a significant breakout above its prior all-time high serving as the primary indicator for further price advancements.

In his analysis, CW shared a chart demonstrating that XRP typically follows a four-phase pattern across various market cycles, notably from 2014 to 2018 and from 2017 to the present. In the cycle from 2014, Phase 1 commenced with a sharp increase to the first target price (TP1), achieving a new all-time high (ATH). Following this peak, XRP entered Phase 2, characterized by the formation of a Symmetrical Triangle, where the price moved sideways within a narrowing range for several months.

Phase 3 followed, marking an extended consolidation period for XRP. Eventually, the price broke through the upper boundary of the symmetrical triangle and entered Phase 4, where XRP surged to TP2, culminating in a second ATH at the 6.618 Fibonacci extension level.

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Source: Chart from CW on X

According to CW’s chart, XRP has completed Phases 1 to 3 in the current cycle and is now in Phase 4. After reaching its initial peak around $3.5 (TP1) earlier this year, the cryptocurrency has recently surpassed the upper boundary of a similar Symmetrical Triangle pattern, entering the "neutral state."

With XRP now in this neutral phase, CW indicated that it has entered Phase 4, the concluding segment of the historical four-phase pattern. The analyst forecasts a potential new all-time high for XRP around $21.5, aligning with the 6.618 Fibonacci extension from the earlier cycle in 2014.

Analyzing Momentum Indicators Across Phases

At the bottom of CW’s price chart, a Stochastic Oscillator and a Moving Average Convergence Divergence (MACD) histogram are displayed. The stochastic indicator illustrates the overbought and oversold conditions throughout each cycle.

During Phase 2 of every cycle, the stochastic frequently indicates oversold levels, which corresponds with the prolonged consolidation and price decline seen during that period. In Phase 3, it maintains a neutral position in the middle range, indicating a balanced state. Finally, in Phase 4 of the 2014 cycle, the indicator surges toward overbought levels, coinciding with substantial price breakouts.

Simultaneously, the MACD histogram reflects momentum changes in each phase. Phase 1 displays robust positive bars indicating strong momentum during the initial breakout. In Phase 2, the histogram shifts to negative bars as the price declines, signaling bearish conditions. Following this, Phase 3 showcases small, varying bars, signifying weak momentum. Lastly, in Phase 4, the histogram's rapid expansion on breakout leads to new ATHs, similar to what was observed in 2014.

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XRP trading at $2.11 on the 1D chart | Source: XRPUSDT on Tradingview.com