"XRP, pressed to the brink of explosion"... Reversal if $1.45 is breached

▲ XRP

XRP has entered a period of extreme volatility compression not seen in years, increasing the likelihood of significant price movements.

BeInCrypto reported on May 4 (local time) that the Bollinger Band width on XRP's daily and weekly charts has narrowed extremely, indicating that the market is on the verge of a directional breakout. The Bollinger Band Width Percentile indicator on the weekly chart remains at the lowest end of its range, marking the lowest volatility level since the expansion phase in late 2024.

The same trend was observed on the daily chart. The Bollinger Band Width Percentile indicator has shown extreme low signals three times in recent weeks and has remained fixed at the bottom of the indicator since late April. The Relative Strength Index (RSI) hovered around 40, indicating a situation where neither buyers nor sellers had a clear advantage.

On-chain metrics also support the quiet market trend. According to Santiment data, the number of XRP whale transactions exceeding $100,000 has decreased to 117. This is significantly lower than the peaks of 700 to 900 transactions recorded during increased volatility in January and early February. Exchange inflows also approached their lowest level in the last six months, at approximately 2.19 million XRP per day. While large holders are not actively selling or buying, retail investor activity has also weakened.

From a technical structure perspective, XRP is compressing its direction within a converging triangle. The descending resistance line has come down from around the mid-February high, forming near $1.45, while the ascending support line has risen from around the early February low, moving to approximately $1.30. The zone with the highest accumulated trading volume is between $1.35 and $1.42, identified as a key battleground for determining the short-term price direction.

BeInCrypto analyzed that if a breakout above $1.45 is confirmed, there could be room for an upside move to $1.4697 and the weekly Fibonacci 0.618 retracement level of $1.7045. Conversely, if it falls below $1.3563, the range between $1.1427 and $1.1729, coinciding with the weekly Fibonacci 0.786 retracement level, was suggested as the next support zone.

Potential catalysts to resolve this compression period include Bitcoin and Ethereum spot ETF fund flows, Ripple-related legal issues, and macroeconomic changes. While volatility remains low, as the end of the triangular convergence approaches, there is an increasing possibility that a large candle will determine XRP's next direction.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*