XRP is at a pivotal point in time as the larger cryptocurrency market appears to be getting ready for a possible big move. As Bitcoin maintains its position around $104,000, showing signs of robust accumulation and the potential for another leg up, XRP appears to be hesitating, which is a risky position to be in during a market-wide shift.
A long descending wedge formation, which is usually a bullish reversal pattern, has been broken out of by XRP from a technical perspective. Bulls' resolve is being tested by the recent pullback toward $2.30 despite the breakout sending the token toward the $2.60 zone. The 26 EMA at $2.31 and the 50 EMA at $2.25 are important support levels that XRP is currently holding just above at $2.38.
A return to consolidation or, worse, a decline toward the $2.10 or even $2.00 zone would be indicated by a breakdown below these averages, which would negate most of the bullish momentum. The issue is the way XRP is responding in comparison to BTC. It might indicate weak hands in XRP or just a lack of buying conviction if Bitcoin breaks higher and XRP does not follow.
Because of this divergence, XRP would be more susceptible to a severe correction. With recent red candles volume has been decreasing, giving a mixed signal: Buyers are obviously cautious, but sellers are not overpowering the market. A retest of the recent high is possible if XRP is able to maintain current levels and recover $2.50. But the slide might quicken if $2.30 doesn't hold.
Bitcoin can see new heights
The price of Bitcoin is consolidating just below its most recent local high of $104,000, and all indications suggest that a significant volatility event is about to occur. BTC has entered a textbook continuation pattern, which consists of tight daily candles with decreasing volume following its strong breakout above the $98,000 resistance level. This suggests that a strong directional move is about to occur.
Just above important support levels like the 26 EMA, Bitcoin is displaying a tight bull flag or mini-consolidation pattern on the chart. The price is still comfortably above the 50 and 100 EMAs, which is significant because it shows strong short- and medium-term strength. Another upward push is possible without going into severe overbought conditions because the RSI is somewhat cooling off.
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In terms of volatility, conditions are favorable for a significant expansion. The implied volatility across options markets, which frequently comes before a significant breakout or breakdown, is declining as a result of the extended sideways price movement.
It is normal for volume to have tapered off a little during this consolidation. Importantly, a clear break above $104,500 would nullify any remaining bearish divergence and probably push Bitcoin into price discovery territory above $110,000.
Before there is any more bullish continuation, there may be a brief retracement toward $98,000 or even $95,000 if the psychological level of $100,000 is not maintained and there is a breakdown below the 26 EMA.
Ethereum's volatility is close
Ethereum is consolidating above its recently broken 200 EMA, displaying the classic indicators of a big move in the making. ETH surged through several resistance levels following a strong breakout rally in early May, surpassing the long-feared 200-day Exponential Moving Average. This is a major turning point for any asset aiming for a long-term trend reversal.
Ethereum is retesting the 200 EMA zone as support at the current price of $2,500, which may indicate the next significant move. Ethereum has a good chance of reaching the psychological barrier of $3,000 if this level holds. Bullish conviction is typically reinforced by a sustained close above the 200 EMA, but the current structure indicates that Ethereum is at a crucial turning point. The rapidly declining trading volume is what's adding a degree of caution to the mix.
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As it suggests that fewer traders are buying into the recent push, this divergence — rising or holding prices on declining volume — is frequently a warning sign for traders. A possible steep retracement back toward the $2,300-$2,200 range is now possible if this trend persists. Incoming volatility is screaming from the technical setup. With Monday's trading session approaching, the market will soon determine whether bulls can hold onto control or if bears are poised to regain ground.
The recent price structure is getting tighter. In the past, Monday openings have frequently confirmed or rejected weekend price action, acting as catalysts for volatility. At this point, Ethereum's future depends on this retest. A reversal from the current levels might initiate a second bullish acceleration wave, which might aim for $3,000 and higher. But there could be a quick and harsh pullback if the 200 EMA doesn't hold.
