Is XRP price going to crash again?

XRP (XRP) price has recovered from its low of $1.94 reached on Feb. 28, but it’s still trading below a key resistance zone. Will XRP’s price drop further in the coming days?

XRP price must hold above $2.00

Today’s drop in XRP price is part of a correction that began on March 3 that saw the relative strength index (RSI) fall sharply following XRP’s drop from $3.00.

Key levels to watch:

• XRP bulls are focused on defending the psychological support at $2.00.

• This level has not been broken since Dec. 1. 

• The RSI is below the middle line at 42, suggesting that the market conditions still favor the downside.

• XRP could extend the decline to the recent range low at $1.76 (formed on Feb. 3) and the support level at $1.61, where the 200-day SMA currently sits.

• The bullish case for the altcoin hinges on XRP turning the resistance between $2.53 and $2.62 into support.

• These levels are also the 100-day and 50-day SMAs.

• A close above the 50-day SMA could pave the way for a return to $3.00 or the seven-year high above $3.40.

The XRP liquidation 24-hour liquidation heatmap chart shows that there is a big cluster of bids at around $2.00.

XRP price runs into resistance at $3.00

XRP bulls are looking to regain their strength after failing to sustain momentum over the last couple of weeks.

• XRP’s 66% rally between Feb. 3 and March 2 was stopped by supplier congestion around the $3.00 level.

• However, XRP is still validating a bull flag pattern in the weekly timeframe, as shown in the chart below. 

• The price now rests on support at $2.16 at the upper boundary of the flag. 

Related: XRP price risks another 20% drop after ‘Digital Asset Stockpile’ letdown

• However, a bearish cross produced by the MACD suggests that XRP might drop further from the current levels.

• As such, if XRP closes below the weekly support level of $2.16, it will drop back into the confines of the flag, where it could continue consolidating for a few more weeks.

As Cointelegraph reported, if the critical $2-level breaks, XRP can drop toward its 50-weekly exponential moving average (EMA) at $1.46, particularly as the hype around the US strategic reserve fades.

“The US government’s commitment to only selling altcoins from its new Digital Asset Stockpile is posing a threat to XRP’s uptrend prospects.“

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.