Ripple is the verge of tumbling from a high cliff; breakdown eyes $0.4

Published December 14, 2020 | Updated December 14, 2020

Ripple XRP
Image Courtesy of Pixabay

Ripple is the verge of tumbling from a high cliff; breakdown eyes $0.4

  • Ripple is on the verge of a breakdown to $0.4 if support at the 200 SMA on the 4-hour chart caves.
  • XRP/USD is likely to invalidate the downtrend if it closes the day above $0.5 or the 200 SMA.

Ripple is trading under intense overhead pressure, risking a massive freefall back to $0.4. Losing the support at $0.4 was a blow to the progress XRP had made in November. For now, the path of least resistance is downwards, as seen on the 4-hour chart.

The lower boundary of the descending parallel channel appears to be holding the fort for the bulls.  However, the Relative Strength Index has reinforced the ongoing bearish momentum. If the indicator hits the oversold area, selling orders are likely to increase significantly.

The 200 Simple Moving Average on the 4-hour chart is also in line to offer immediate support, and buyers must hold this crucial support. Otherwise, XRP/USD could tumble to $0.4 (next tentative support area).

XRP/USD 4-hour chart

XRP/USD price chart
XRP/USD price chart by Tradingview

The daily chart also confirms the bearish outlook, suggesting that the next critical support lies at the 50 SMA. Similarly, the RSI is in a sloping motion but has not hit the oversold area yet. This could mean that XRP bears still have enough room to explore before recovery comes into play.

XRP/USD daily chart

XRP/USD price chart
XRP/USD price chart by Tradingview

On the other hand, the bearish picture will be invalidated if Ripple closed the day above $0.5. Moreover, the support at the channel’s lower boundary as well as the 200 SMA on the 4-hour would secure the uptrend if they remain intact. The most significant upward movement for XRP would be to overcome the hurdle of $0.6.

Ripple intraday chart

Spot rate: $0.495


Relative change: -0.02

Percentage change: -3.4%

Trend: Bearish

Volatility: High

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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John Isige 1043 Articles
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