XRP (XRP) Looks Bullish as it Forms a Bullish Inverted Head and Shoulder Price Action Pattern

In the past few days, the overall cryptocurrency market has been there for sideways including top assets such as Bitcoin (BTC), Ethereum (ETH), Solana (SOL), and XRP (XRP).

The cryptocurrency market has been largely dull over the past few days, with top assets like Bitcoin (BTC), Ethereum (ETH), Solana (SOL), and XRP (XRP) showing limited price action. However, this sideways movement has created a bullish trade setup in Ripple’s native token XRP, presenting an ideal opportunity for traders.

XRP Bullish Trade Setup

A technical and price action analysis reveals that XRP is displaying a bullish setup as it approaches a crucial support level of $0.55. At this level, the token is forming a bullish inverted head and shoulder price action pattern.

So far, one shoulder and the head have formed on XRP's daily chart, with the second shoulder currently in the making. There's a high probability for XRP to complete its second shoulder.

This level presents a strong buy opportunity, offering a 1:2.5 risk-to-reward trade. According to the price action pattern, XRP could rally 12% to $0.635, with an optimal stop-loss placed below the 200 Exponential Moving Average (EMA) and the support level at $0.539.

Throughout the recent market crash and significant price action observed in other cryptocurrencies, XRP has managed to hold above this support level.

XRP Price Summary

At press time, XRP trades at $0.567, having experienced a price increase of over 1.35% in the last 24 hours. Moreover, it has seen a price decrease of 5% over the last 7 trading days, as reported by coinmarketcap.

In the meantime, XRP's trading volume has dropped by 45%, indicating lower participation from traders and investors in the last 24 hours.

Major liquidation levels

Currently, XRP's major liquidation levels are around $0.553 on the lower side and $0.575 on the higher side, as reported by on-chain analytics firm Coinglass. These levels indicate where traders are placing a significant amount of leveraged bets.

If the market sentiment turns bullish and XRP's price reaches the $0.575 level, nearly $8.04 million in short positions will be liquidated. On the other hand, if the price falls and reaches the $0.553 level, nearly $6.9 million in long positions will be liquidated.

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