XRP, Suppressed to the Brink of Explosion... Reversal if $1.45 is breached

▲ XRP

XRP is entering an extreme volatility compression phase not seen in years, increasing the likelihood of significant price movements.

BeInCrypto reported on May 4 (local time) that the Bollinger Bands width on XRP's daily and weekly charts has narrowed extremely, indicating the market is on the verge of a directional breakout. The Bollinger Bands Width Percentile indicator on the weekly chart remains at the lower end of its range, marking the lowest volatility level since the expansion phase in late 2024.

The same trend was observed on the daily chart. The Bollinger Bands Width Percentile indicator showed extreme low signals three times in recent weeks and has remained fixed at the bottom of the indicator since late April. The Relative Strength Index (RSI) hovered around 40, indicating that neither buyers nor sellers had a clear advantage.

On-chain metrics also support the quiet market trend. According to Santiment data, the number of XRP whale transactions exceeding $100,000 decreased to 117. This is significantly lower than the peaks of 700 to 900 transactions recorded during increased volatility in January and early February. Exchange inflows also approached their lowest level in the past six months, at approximately 2.19 million XRP per day. With large holders neither actively selling nor buying, the flow from individual investors has also weakened.

Technically, XRP is compressing its direction within a symmetrical triangle. The descending resistance line has moved down from the mid-February highs, forming near $1.45, while the ascending support line has moved up from the early February lows, settling around $1.30. The area with the highest trading volume accumulation, between $1.35 and $1.42, has been identified as a key battleground for determining short-term price direction.

BeInCrypto analyzed that if a breakout above $1.45 is confirmed, there could be room for an ascent to $1.4697 and the weekly Fibonacci 0.618 retracement level of $1.7045. Conversely, if it drops below $1.3563, the range between $1.1427 and $1.1729, coinciding with the weekly Fibonacci 0.786 retracement level, was suggested as the next support.

Catalysts mentioned for resolving this compression phase include Bitcoin and Ethereum spot ETF capital flows, Ripple-related legal issues, and macroeconomic changes. While volatility remains low, as the symmetrical triangle approaches its apex, there's an increasing possibility that a large candle will determine XRP's next direction.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*