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XRP, the cryptocurrency behind Ripple, has been a hot topic lately, with analysts predicting a possible price increase to $11. However, before this can happen, XRP has to face a significant challenge: a short-term price correction. Despite the positive long-term view, the asset is expected to face a pullback before any meaningful rally can take place.
Resistance at $2.73 is currently the key level XRP must overcome for further price movement. Crypto analyst Ali Martinez sees this resistance as crucial for the maintenance of a bullish trend of XRP.
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The Critical Breakthrough
Breaking through at $2.73 and following with upward motion might open a gateway to seeing the digital asset touch $11. However, failing to do so could spell trouble for the coin, bringing it down all the way to a potential low of $2.05.
Given the very volatile price range, investors are watching the movement of XRP closely to know whether it is going to rally or correct.
$XRP is still consolidating within the pennant of a massive bull pennant pattern. Until the $2.73 resistance is broken, a pullback to $2.05 remains possible before a potential breakout to $11! pic.twitter.com/ET39FJMtAc
— Ali (@ali_charts) January 4, 2025
Technical Viewpoint
In terms of technical analysis, other well-known analysts following the Elliott Wave Theory says XRP is in a correction. Having gone through a five-wave impulsive rally, they believe that XRP is now setting up for an ABC correction pattern.
This type of correction usually comes after a long rally and acts as a breather before the next big move. Other analysts expect the correction to end around mid-January 2024, thereby giving traders a good opportunity to buy in before a new rally.
This correction may temporarily push the price down, but it could set the stage for a much bigger increase in the coming months.
Bullish Sentiment
With all the associated risks of short-term price correction, overall sentiment is still heavily bullish for XRP. One of the major reasons for this is a resolution that just recently happened with regard to Ripple’s long-running court case with the US Securities and Exchange Commission (SEC).
A favorable ruling on the case lifted much of the uncertainty from XRP’s regulatory standing in the public eye and made it one of the most attractive investments for many. Positive: Expectations for more accommodative crypto-friendly policies from the government and not one for broader market, creating an upward momentum.
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A Brighter Future Ahead For XRP?
Although correction in the near term can be expected, a long-term view about XRP still bodes quite well. When this correction plays out as expected, it can get a good entry point for those interested in investing with the potential next rally.
The road to $11 is still ahead but if XRP keeps on the same track, it will be a show to behold. As usual, traders and investors need to remain vigilant in the expectation of key resistance levels and market trends.
At the time of writing, XRP was trading at $2.41, up 0.1% and 15.4% in the daily and weekly timeframes.
Featured image from Trackinsight, chart from TradingView
