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The cryptocurrency market has been abuzz with the recent price action of Ripple (XRP), as it consolidates above a key bullish setup. With the token hovering around $2.87, many analysts are predicting a potential rally towards $5-$6 if support holds.
Ripple’s recent price movement has seen it break out of a downward-sloping channel and clear the upper boundary of a large symmetrical triangle on its weekly chart. This breakout has been accompanied by a period of consolidation around $2.88-$3.00, which some have interpreted as buyers preparing for another strong rally.
The current short-term trend remains supported by moving averages, with the 9-period average trading above the 21-period one and the price hovering near the faster line around $3. However, if this trend were to shift and prices would drop below both these levels, it could shift momentum in a negative direction.
In other words, while the current setup remains supportive of higher prices, there is always some risk that sellers may gain control and reverse the trend.
Notably, the Accumulation/Distribution line has flattened near -5.25 billion after trending lower for years. This suggests that selling pressure has eased, with more tokens being held rather than distributed. This change aligns with the breakout above the flag pattern, indicating that accumulation may be taking place.
In this context, some analysts are calling for a clean break above $3.12 to open up the possibility of $4-$5. However, others caution that failure to hold at $2.85 could trigger a swift correction, making it essential for investors to maintain a watchful eye on price action and be prepared to adjust their positions accordingly.
Long-term models have been forecasting ambitious targets for XRP, but these projections currently seem out of reach given the token’s inability to break above resistance near $3.10.
For now, the key question is whether this consolidation above the bullish flag can hold. If it does, many traders are eyeing a push towards $5-$6 over the coming months.
Source: TradingView
Source: cryptopotato.com
