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An analyst suggests that, from here, $XRP could either form a bullish double bottom or face a Wave 5 crash depending on how it closes at a critical level.
This disclosure came from prominent market watcher EGRAG Crypto, who has emphasized the importance of the crucial price level. Notably, with $XRP currently changing hands around the $2.29 range, EGRAG has identified this critical level to be the $2.63 mark.
For context, $XRP relinquished this price mark during the massive collapse on March 3, which led to an 18.83% intraday crash for the token. Since then, it has persistently tried to recover the price level but resistance from the bears at lower levels have made this task difficult.
$XRP Forming Bullish Double Bottom
According to EGRAG, this $2.63 mark is extremely important for $XRP, as a close above or below it would determine its next direction in the near term. For instance, $XRP appears to be forming a double bottom structure on the 4-hour timeframe.
Notably, a double bottom pattern springs up during a downtrend and could point to an imminent bullish reversal. The structure features two lows (or bottoms) at nearly the same level, with a peak between them. The peak represents the neckline of the structure, and the pattern is confirmed when the asset closes above this peak.
Data from EGRAG’s chart shows that the first bottom formed when $XRP dropped to $1.9 on Feb. 28. After the asset recovered from this low, it hit a top of $2.63 on March 6. This top represents the peak and the neckline. Meanwhile, the second bottom formed when $XRP collapsed to $1.89 on March 11.
Now, as the altcoin seeks to recover from the recent drop, it needs to close above the neckline at $2.63 to confirm the double bottom structure. This would set the stage for the much-needed recovery, potentially pushing $XRP to previous highs.
Wave 5 Correction Imminent?
However, EGRAG called attention to another technical structure that could materialize if $XRP fails to close above $2.63. According to him, also on the 4-hour chart, $XRP appears to be following an Elliott Wave structure, and is currently on the fourth impulsive wave.
EGRAG’s chart indicates that $XRP is nearly done with the fourth wave, and Wave 5 could lead to a correction. The analyst suggested that if $XRP does not close above $2.63, this would invalidate the double bottom and the Wave 5 structure would take effect, leading to steeper declines.
He presented two major bearish targets for the Wave 5 downside. The first target rests on the $1.71 price level, representing the 1.414 Fibonacci extension. However, if the bearish pressure persists, the analyst expects a steeper decline to the $1.6 mark, last seen in November 2024.
Meanwhile, EGRAG recently stressed in a separate report that the asset is trapped between a critical Exponential Moving Average (EMA) and the Fib. 0.888 retracement around $2.2321.
#$XRP – 3-Day Time Frame:#$XRP is currently caught between the EMA and the Fib 0.888 level. We need to close this 3-day candle above Fib 0.888 ($2.2321).
Closing above the EMA would be very #Bullish! 🌟
We've tapped into the Equilibrium, but will we fill the total Fair Value… pic.twitter.com/pIMIvSVV51
— EGRAG CRYPTO (@egragcrypto) March 13, 2025
He stressed that the asset must close the current 3-day candlestick above the Fib. 0.888 ($2.23). According to EGRAG, if it extends further to close the candle above the crucial EMA, this would be bullish for the market. Currently, $XRP appears to have pushed above the Fibonacci 0.888 mark, currently trading for $2.29.