Whipsaw Above Trendline Resistance for XRP/USD?
With the recent upside in most major crypto pairings, it seems only fitting to look over Ripple’s technical price action against the US dollar (XRP/USD).
Following a pullback from lows of $0.4856 in early February (off support at $0.4946), buyers and sellers have been squaring off at the underside of trendline resistance (extended from the high of $0.7488) since 15 February. While this trendline has attracted selling, it has not been anything to write home about.
Key Resistance Above Trendline Resistance
Consequently, in conjunction with knowledge that the pairing has been in a downtrend since late 2023, and a resistance zone at $0.5999-$0.5846 resides just above the trendline resistance (also houses a Fibonacci cluster around $0.5903), a whipsaw (some may also refer to this as a stop run) through the trendline resistance is a potential scenario to be aware of.
Most traders will know that the bearish response from the trendline resistance on 15 February has prompted traders to locate protective stop-loss orders (buy stops) north of the trendline resistance. How far north is difficult to estimate, yet given we are working with the daily timeframe, a stop area would likely sit within the limits of the resistance zone mentioned above at $0.5999-$0.5846.
Stop Run?
So, the idea here is that although a reaction has been seen at the trendline resistance, sellers failed to hold price beyond $0.5400. As such, as exhibited on the chart, a whipsaw through trendline resistance into the walls of the resistance area could come together and may deliver sufficient technical juice to encourage selling into the buy-stop liquidity above the trendline resistance.
Following a pullback from lows of $0.4856 in early February (off support at $0.4946), buyers and sellers have been squaring off at the underside of trendline resistance (extended from the high of $0.7488) since 15 February. While this trendline has attracted selling, it has not been anything to write home about.
Key Resistance Above Trendline Resistance
Consequently, in conjunction with knowledge that the pairing has been in a downtrend since late 2023, and a resistance zone at $0.5999-$0.5846 resides just above the trendline resistance (also houses a Fibonacci cluster around $0.5903), a whipsaw (some may also refer to this as a stop run) through the trendline resistance is a potential scenario to be aware of.
Most traders will know that the bearish response from the trendline resistance on 15 February has prompted traders to locate protective stop-loss orders (buy stops) north of the trendline resistance. How far north is difficult to estimate, yet given we are working with the daily timeframe, a stop area would likely sit within the limits of the resistance zone mentioned above at $0.5999-$0.5846.
Stop Run?
So, the idea here is that although a reaction has been seen at the trendline resistance, sellers failed to hold price beyond $0.5400. As such, as exhibited on the chart, a whipsaw through trendline resistance into the walls of the resistance area could come together and may deliver sufficient technical juice to encourage selling into the buy-stop liquidity above the trendline resistance.
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