With strong bullish momentum, XRP recently broke through the $1.5 resistance and even briefly touched $1.6. The excitement though was short-lived as sellers took back control and drove the price back below $1.15. There may be a fakeout as indicated by this price action, which could have significant ramifications for XRP's short-term course. A fakeout happens when the price appears to be on a sustained trend after breaking above or below a critical level but it quickly reverses course.
The inability of XRP to stay above $1.5 may indicate a weakening of the buying power or an overextended rally. These actions frequently result in higher volatility as traders reevaluate their holdings. The $1.5 level is still a significant resistance level on the chart. A strong breakout above this range followed by consistent trading above $1.6 might pave the way for XRP to reach $1.8 or even $2 in the upcoming weeks.
This would verify that buyers have taken back control and that bullish momentum is still present. On the downside, $1.3 and $1.2 are important support levels to keep an eye on. In addition to possibly testing the $1 psychological level, a breakdown below $1.3 might indicate a deeper retracement.
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If XRP struggles at higher levels, sellers will probably put more pressure on the market, which will spur profit-taking and reduce momentum. Another factor is the mood of the market as a whole. XRP's recovery has been resilient as evidenced by volume spikes during upward movements. However, XRP's capacity to recover higher levels might be hindered if the momentum of the larger cryptocurrency market slows.
