Despite the amount of time XRP bulls defended the $2 area, the liquidity accumulation below this support area was relatively small.
XRP price has taken a bearish turn.
The defense of $2 support was strong and selling volume was weak.
Based on the price charts and heat map, Ripple [XRP] has a short-term bearish outlook. Like most of the crypto market, XRP has suffered due to Bitcoin [BTC]’s decline over the past two weeks.
The daily time frame also reflects a bearish outlook for XRP price. A drop below the $2 demand zone is likely to be followed by a deeper pullback towards $1.4 or even $1. This could provide a buying opportunity for swing traders to re-enter the market.
Source: XRP/USDT on TradingView
Analysis of the daily time frame of XRP indicates a bearish bias. The price action shows a bearish structure, and the pullback phase is underway. The Awesome Oscillator has crossed below the zero line, indicating that the bearish momentum is gaining strength.
A drop to the 61.8% and 78.6% Fibonacci retracement levels is possible but not very likely at this time, due to strong buying interest in the $1.96-$2.2 demand zone. This zone was identified as a fair value gap on the daily chart from December 1.
The A/D indicator continues to trend higher, indicating steady buying pressure. Thus, despite the momentum shift, selling volume has been relatively low, as evidenced by the downward trend in the volume bars over the past three weeks.
Liquidity buildup and imminent price targets
XRP Liquidation Heat Map
Source: Coinglass
Despite the efforts of XRP bulls to defend the $2 area, the liquidity accumulation below this support area is still relatively small. The liquidation heat map highlights the $1.98 and $2.23 areas in light green, indicating that these are the next important price targets.
It is possible that XRP will revisit these areas and temporarily reverse towards another pocket of liquidity, forming a range in the coming weeks.