XRP could pump to $0.209 in the short-term; long-term less rosy
Since 16 December, XRP has been hovering around the $0.19 mark, with intermittent dips under $0.185 and rises around $0.198. With a value of around $0.191 at the time of writing, XRP could be in for a short-term rise in value, despite its less-optimistic long-term prospects.
XRP 4-hour chart
Following a 20% loss of value in less than three days, XRP dropped into a symmetrical triangle formation on 18 December, a pattern that tends to break-out upwards in 60% of all cases. These breakouts tend to happen 73-74% of the way to the triangle apex, giving us a tentative breakout date of 3 January — tomorrow.
The 50-MA could be seen intersecting the latest 4-hour candle, giving XRP a chance to cross above it into a more bullish case. With volume trending downwards over the pattern, which occurs in 86% of all symmetrical triangle formations, XRP’s value could move up to the breakout point at $0.196 or down below the Point of Control on the volume profile within the next day.
Assuming XRP is able to push above the immediate resistance from the 50 MA, a climb to the breakout point at the upper pattern boundary seems plausible, with a potential pump to just under the 61.8% Fibonacci retracement line likely following.
If XRP manages to maintain its value for the next 8-12 hours, a breakout from the lower pattern boundary could push it down to $0.182.
XRP 1-day chart
The 1-day chart showed both the 200 and 50-day moving averages looming far above the price line, each of which underwent a death cross in mid-August and highlighted further bearish movement in the long-term. The MACD appeared bullish, however, with the blue MACD line having crossed over the signal line towards the end of December.
The on-balance volume indicator was moving just above the 200M mark, having been on the rise since 16 December. However, it seems to have hit resistance at the 260M mark, a mark which it failed to cross between late-November and early-December. This could predict a drop in OBV, further affirming that a drop in price could be in store for XRP in the long-term.
Though long-term prospects looked unfavorable overall, with the price moving just above the $0.187 support line, the moving averages appeared to dip downwards and in light of the bullish signal from MACD, we could see a short-term rise in price.
Network Value to Transactions Ratio
According to CoinMetrics, the Network Value to Transactions (NVT) ratio which was devised and popularized by Willy Woo and Chris Burniske measures “the dollar value of crypto-asset transaction activity relative to network value.” Here, a ‘low’ market to transaction value denotes “an asset which is more cheaply valued per unit of on-chain transaction volume.”
According to Willy Woo himself, this metric is higher either when the network is in “high growth and investors are valuing it as a high return investment,” or when “the price is in an unsustainable bubble.” As of 1 January, the XRP NVT metric was 7.3x higher than what it was on 31 December, indicating that the coin could be valued more per unit of on-chain transaction, which could be interpreted as a buy signal.
If XRP manages to push above the 50-MA on the 4-hour chart, it is likely the coin will continue to push upwards, breaking out upward from $0.20 to at least $0.209 in the next day or so. A break downward would see XRP dropping to $0.182 over the same time frame. Though XRP’s long-term prospects are arguably not that great, a short-term move up in price doesn’t seem unreasonable at this point in time.