Ripple Technical Analysis for 06/06/2017 – Descending Triangle Consolidation

By June 6, 2017Bitcoin Business
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Ripple Technical Analysis for 06/06/2017 – Descending Triangle Consolidation

Ripple recently made a breakout from a descending trend line and has pulled back for a retest. However, price is consolidating at the moment in a descending triangle formation as it formed lower highs and found support at 0.2700.

The 100 SMA is still above the longer-term 200 SMA on the 1-hour chart so the path of least resistance is to the upside. However, ripple found resistance at the 100 SMA dynamic inflection point which coincided with the top of the triangle. Price is currently testing support at the 200 SMA.

The gap between the moving averages is narrowing to reflect weakening bullish pressure. A downside break from support could lead to a downward crossover and draw more sellers to the mix, leading to more losses for Ripple. Note that the triangle spans 0.2700 to 0.3400 so the resulting selloff could be of the same size.

Similarly a break past the resistance could spur a climb of the same height for Ripple. Stochastic is heading south so XRPUSD could follow suit while bears remain in control. RSI is heading lower as well, indicating that bearish pressure is in play. Once both oscillators hit oversold levels and turn higher, bulls could get back in the game and trigger a bounce.

Traders seem uneasy about holding the US dollar these days as there is a lot of speculation leading up to former FBI head Comey’s testimony on Thursday. He is expected to shed more light on whether or not the administration asked him to drop the investigation into former national security adviser Michael Flynn and if there were any links to Russian officials.

Any indication of wrongdoing on the side of the Trump administration could spell weaker expectations for fiscal reform happening anytime soon. It doesn’t help that the latest jobs report printed downbeat results and doused tightening expectations for later in the year.

To top it off, geopolitical uncertainties in the United Kingdom and Middle East are dampening demand for traditional securities and could shore up gains for digital assets like Ripple and bitcoin. However, it would be safer to wait for a breakout on Ripple to see where market participants take this next.

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