At the start of the previous month, Elon Musk, the CEO of Tesla, has triggered a massive selloff in Bitcoin and other cryptocurrencies. He stated that Tesla will now not accept Bitcoin for the purchasing of its vehicles, and so the price of Bitcoin collapsed from above $60k to $30k, literally halving. On its way to the downside, it triggered similar bearish price action in other markets, such as Ripple, that fell in a similar fashion.
Ripple bulls, though, have some signs of a reversal in place. First, the market broke below 1.20, a pivotal area, but it formed a bullish divergence shortly after that. The bullish divergence started after the 1.20 proved as a strong resistance level. Hence, it remains pivotal for any attempt to the upside.
Second, the move lower below parity and toward 0.7 resembles an inverse head and shoulders pattern. Because the market quickly retraced it, we may have an inverse head and shoulders in place, with a measure move above 1.40.
But if the measured move is reached, it means that the price action was powerful enough to break 1.20. Hence, bulls may want to wait for the price to close above 1.20 before going long with a stop-loss at 1.00 and a take profit at 1.6.
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