The XRP price has plunged by over 35% from its highest point in January as it shed billions of dollars in value. Ripple was trading at $2.2093, a range it has remained at in the past few weeks. This price is about 36% above its current level this year. Let’s explore a few reasons why the XRP price may go vertical soon.
XRP price has encouraging technicals
The first main reason why the XRP price may surge is that it has strong technicals. The daily chart shows that Ripple was trading at $2.2075 on Thursday, a few points above the 200-day Exponential Moving Average (EMA). This moving average has provided it with substantial support in the past few months.
XRP price has continued forming a symmetrical triangle pattern on the daily chart. This triangle happens after it went vertical in November last year, meaning that it is a bullish pennant pattern, a popular bullish sign. In a pennant, the breakout normal happens when the triangle pattern is about to form.
Some oscillators, like the Relative Strength Index (RSI) and the Stochastic, have also pointed upward. Also, the recent low volatility and volume mean that the coin is at the accumulation phase of the Wyckoff Theory.
Therefore, the most likely scenario is where it bounces back, and possibly retests the resistance at $3.4, the highest point this year, which is about 53% above the current level. A surge above that price will raise the odds of it moving to $5.
The invalidation point of this pattern is at $1.6115, its lowest point this year. A move below that level will signal more downside, potentially to $1 or below.
XRP price chart | Source: TradingView
Top catalysts that may drive Ripple price growth
The XRP price may surge for several reasons. First, as we wrote on Wednesday, Bitcoin price has a bullish outlook this year and may soon have a breakout.
Technically, it is forming a cup-and-handle pattern with a depth of about 30%. This means that it will likely have a bullish breakout to over $140,000 later this year, which will drive other top altcoins, including XRP, higher.
Fundamentally, Bitcoin has strong metrics, including soaring ETF inflows and corporate demand, and falling supplies.
Second, there are signs that the Securities and Exchange Commission will approve XRP ETFs by October this year. These odds have soared to over 93% on Polymarket now that Paul Atkins is the agency’s head.
A Ripple ETF approval will be bullish for the coin as it will point to more institutional demand in the long term. Analysts anticipate that these funds may lead to inflows of about $8 billion in the first year, beating Ethereum, which has gained less than $3 billion.
Third, XRP utility is expected to keep growing in the coming months. One reason for this is that Ripple Labs will integrate Hidden Road payments worth over $10 billion a day to the XRP Ledger. Higher transaction volume means more fees and a higher burn rate.
XRP Ledger will also see higher activity because of the growing market share of the Ripple USD (RLUSD) stablecoin. Launched a few months ago, it has gained over $300 million in market share and is compliant with MICA and GENIUS Act.
Finally, Ripple Labs is on a journey to disrupt the payment industry that Swift Network now dominates. It will continue to partner with banks and other remittance companies to achieve this goal.
Apple is pitching its RippleNet solution as a better alternative to Swift Network, whose technology is 50 years old. Swift is often expensive, and transactions take a long period to execute.
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