Cryptocurrencies have been on a decent bullish run for several weeks, since the big bearish period ended at the end of July. Ripple coin was also in a middle of a strong bullish run, after it had broken above the resistance zone surrounding $1.30, which had been keeping buyers in check in the last month or so.
That was a bullish signal, which indicated further upside momentum to come, but the situation changed in a moment in the crypto market. Cryptocurrencies turned lower suddenly and crashed lower, with BITCOIN crashing below $43,000 from around $53,000 and ETHEREUM falling to $3,000 from $4,000.
That seemed strange after El Salvador made Bitcoin legal tender yesterday and announced it the Bitcoin Day in the country. They blamed IMF and World Bank for the crash, since they have been opposing countries adopting cryptocurrencies and they were against El Salvador doing so. They might have interfered in the crypto market, selling Bitcoin which sparked the decline. El Salvador’s president Bukele and others accused the IMF and the World Bank of manipulating the price, as my colleague Arslan highlighted earlier.
Ripple Coin Analysis – XRP/USD Finding Support at the 50 Daily SMA
The 50 SMA is holding as support today, which is a positive signal for buyers
Then buyers who had bought Bitcoin from lower did some profit-taking and the decline accelerated. XRP/USD fell below $1, losing around 50% of its value during that flash crash and the price pierced the 50 SMA as well on the daily chart. Although, the decline stalled toward the evening and Ripple coin eventually closed the day at $1.12, which was a good sign, since it pulled back up above the support zone around $1.05.
But, the decline resumed again earlier today. Sellers pushed the price down to $1.02, but the 50 daily SMA held as support and now Ripple is trying to put up a fight, as buyers push back up. If the negative sentiment turns around in cryptos, then Ripple will resume the bullish trend again, so we are holding on to our buy Ripple signal.
It seems like this is happening now, since the low today was higher than yesterday’s low and the 50 SMA held today as support. So, let’s follow the price action and see where the price will close today. Those who are out of Ripple coin might find this a good opportunity to go long on XRP/USD, since the stochastic indicator is becoming oversold as well.