Ripple price corrected lower after a massive rally above the $0.7500 level against the US Dollar. XRP/USD is now approaching the key support at $0.4950.
- Ripple price is correcting lower, but it remains supported near the $0.4950-0.5000 zone.
- XRP/USD is trading inside a major contracting triangle with resistance at $0.5500 on the 4-hours chart.
- XRP price needs to stay above the $0.4950 support to stay in the current uptrend.
Ripple price analysis
This past week, there was a solid rally in ripple price above the $0.3340 pivot level against the US Dollar. XRP/USD surged above the $0.4900, $0.5000 and $0.6200 resistance levels.
The 4-hour chart indicates that the price traded close to the $0.8000 level and formed the $0.7996 high. Later, the price started a downside correction and declined below the $0.6000 level, but it is still well above the 100 simple moving average (4-hours).
During the decline, the price broke the $0.6200 support zone and the 50% Fib retracement level of the last major upward move from the $0.3115 low to $0.7996 high. However, the decline found support near the $0.4950-0.5000 zone.
The mentioned $0.4950 level is very important since it was a resistance earlier and now it represents the 61.8% Fib retracement level of the last major upward move from the $0.3115 low to $0.7996 high.
More importantly, there is a major contracting triangle forming with resistance at $0.5500 on the same chart. The triangle support is near the $0.4800 level and resistance is at $0.5500. Therefore, the next move in XRP/USD could be either above $0.5500 or below $0.4950-0.4800.
If there is a bearish break below $0.4950 and $0.4800, the price could decline all the way back to the $0.3340 pivot level. On the other hand, if the price breaks the $0.5500 resistance, there could be a fresh upward move towards the $0.6200 level.
Above $0.6200, the price will most likely trade above the $0.7000 level. The overall price action is positive for ripple as long as the price is above the $0.4950 and $0.4800 support levels. On the upside, sellers are likely to take a stand near $0.6200 and $0.7000.