For a moment, it looked like the Ripple price was breaking out of its downtrend. However, the momentum lacks conviction, and XRP is again turning lower.
There was a time when Ripple was the third-largest cryptocurrency. In 2017, XRP was generally thought of as a serious contender. But unlike many of its peers, which set new records in 2021, XRP never came close to January 2018’s $3.55 high in this year’s bull run.
Certainly, most of the blame lies in the SEC’s ongoing lawsuit regarding XRP’s status. This has caused Ripple to underperform and is 66% lower than its April $1.98 high.
Despite promising utility, the Ripple price action has seen the coin slip down the rankings. Its $31.4 billion market cap is now below Dogecoin, which sits above Ripple as the sixth-largest cryptocurrency.
Using the daily chart, we can see following yesterday’s strength in Bitcoin, the Ripple price appeared to be breaking above an important downtrend. However, this morning, BTC is rolling over and is off $1,500 from yesterday’s $35,900 high. This has resulted in weakness spilling over into XRP.
Technicals remain weak for Ripple. The price is below all three major moving averages, which are offering resistance above the market. The first of which is the 200 DMA at $0.7800.
Furthermore, a strong horizontal line of resistance from February’s $0.7800 high adds a secondary resistance layer around the 200-day average.
Additionally, the recent price action has formed a bear flag. The bottom end of this pattern aligns with today’s $0.6680 low. Therefore, if XRP makes a new low, it will force the price beneath this support level.
In that event, Ripple would target the 22nd of June low at $0.4799.
As long as the price remains below the 200-day moving average, the outlook remains cloudy at best. Furthermore, until the court case with the US regulator is concluded, it’s hard to see a scenario where the Ripple price sustains a rally.
Of course, the first indications that a favourable ruling lies ahead would be a game-changer for Ripple. Until then, the bulls could remain frustrated.
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