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XRP Volatility Might be Fading – Downside Break or Rally Ahead?

2 mins
Updated by Mohammad Shahid
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In Brief

  • XRP’s price has stalled between $3.22 and $3.30 after a 20% rally earlier this month, with volatility dropping 10% since August 7.
  • Technical indicators, including the Elder-Ray Index, show weakening bullish momentum, suggesting sellers may soon take control.
  • A break below $3.22 could send XRP toward $2.99, while a move above $3.33 could spark a rally to $3.66.
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XRP’s market momentum has slowed since Friday, with trading activity cooling and price action moving sideways. 

The token, which had seen modest movement earlier in the week, now shows signs of reduced volatility and weakening demand, raising concerns about a potential bearish shift.

XRP Trading Flatlines, But Sellers Could Soon Take Control

Readings from the XRP/USD one-chart show that the altcoin has trended within a narrow range over the past three trading sessions. Since Friday, XRP has faced resistance at $3.30 and found support at $3.22. 

This follows a four-day rally between August 3 and 7, during which the token surged by 20%. The current sideways trend indicates reduced market volatility, reflecting a relative balance between buying and selling pressure. 

In such phases, the market is often in a “wait-and-see” mode, with traders anticipating a catalyst to determine the next price move.

The decline in volatility is evident in XRP’s Average True Range (ATR), which has dropped by 10% since August 7. The ATR measures the degree of price fluctuation over a set period, and a falling ATR signals calmer market conditions with less volatility.

XRP Average True Range
XRP Average True Range. Source: TradingView

While periods of low volatility suggest market stability, it can also mean traders are becoming less active, often a precursor to a sharp breakout in either direction.

Furthermore, XRP’s Elder-Ray Index strengthens the case for a potential bearish breakout. This indicator measures the strength of buyers (bull power) and sellers (bear power) by comparing price movements against a moving average. 

On XRP’s daily chart, the Elder-Ray Index has been posting green histogram bars, representing bullish strength, that have steadily diminished in size over the past few days.

XRP Elder-Ray Index.
XRP Elder-Ray Index. Source: TradingView

This contraction points to a loss of buying momentum and creates an opening for sellers to assert control and drive XRP’s price lower.

XRP Faces Make-or-Break Moment Between $3.22 and $3.66

Strong sell-side pressure could trigger a break below support at $3.22. If this happens, XRP’s price could deepen its decline and fall to $2.99.

XRP Price Analysis
XRP Price Analysis. Source: TradingView

However, XRP could push above the price wall at $3.33 if new demand resurfaces. A successful breakout could open the door for a rally toward $3.66. 

Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

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Abiodun Oladokun
Abiodun Oladokun is a Technical and On-Chain Analyst at BeInCrypto, where he specializes in market reports on cryptocurrencies from diverse sectors, including decentralized finance (DeFi), real-world assets (RWA), artificial intelligence (AI), decentralized physical infrastructure networks (DePIN), Layer 2s, and meme coins. Previously, he conducted market analysis and technical assessments of various altcoins at AMBCrypto, utilizing on-chain analytics platforms like Messari, Santiment...
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