Ripple Price Analysis: XRP Likely to Retrace Toward $2 Before Targeting New ATH
2024-12-02

XRP has experienced an explosive rally, breaking through significant resistance levels and reaching its highest levels in almost seven years.
However, with the market showing signs of overheating, a consolidation phase is anticipated in the near term.XRP Analysis
By ShayanThe Weekly Chart
Ripple has shown an impressive surge, climbing over 100% since last week, pushing past the $2 resistance level, and hitting $2.5 for the first time since January 2018. This strong upward movement signals a dominant buying presence in the market.
The price action reflects extreme optimism, but the RSI has surged into overbought territory, suggesting the market is overheated. Such conditions often precede a period of consolidation or corrective retracements, as buyers may need time to digest the gains before pushing the price higher again.
In the mid-term, the key support level to watch is the $2 threshold, which has now turned into crucial support after being reclaimed as resistance during the recent surge. A pullback toward this level would be healthy for the market, offering a chance for buyers to regroup before a potential continuation of the uptrend.The 4-Hour Chart
On the 4-hour timeframe, the bullish structure is clear, with higher highs and higher lows. Ripple has successfully reclaimed several key resistance levels, including its previous ATH of $2, before surging to the new $2.5 mark.
The asset recently broke above the upper trendline of an ascending channel, further emphasizing buyers’ dominance. However, the RSI on this shorter timeframe shows a notable bearish divergence, signaling that a correction is likely in the near term.
With its large number of leveraged positions, the overheated futures market increases the likelihood of a liquidation cascade if the price experiences a sharp decline. This suggests that while the mid-term outlook remains bullish, short-term consolidation or a pullback is expected, potentially leading to heightened volatility.