The recent surge in cryptocurrency prices was apparently a result of a buy order for 20,000 Bitcoin spread across different exchanges. This is why Bitcoin (BTC) rallied the most and cryptocurrencies like Ripple (XRP) followed. While Ripple (XRP) is up more than 6% for the day, it is still down around 6% against Bitcoin (BTC). The recent rally in Bitcoin (BTC) seems to be losing steam and the price is likely to retrace significantly in the days ahead. However, this has put Ripple (XRP) in a tough spot once again as the cryptocurrency is massively already oversold against Bitcoin (BTC) on both the weekly and daily time frames. The question is, if the market continues to decline in the weeks ahead, will Ripple (XRP) continue to fall harder than Bitcoin (BTC) despite XRP/BTC being massively oversold?
The weekly chart for XRP/BTC shows that the price has now retested the bottom of the symmetrical triangle that extends all the way to December, 2017. This symmetrical triangle can also be interpreted as a bullish pennant which has the potential to push XRP/BTC to a new all-time high if it breaks out to the upside. The weekly Stochastic RSI shows that the price is incredibly oversold and is highly likely to break to the upside. However, as we have seen just recently, technicals do not make much sense when the market makes sudden moves in a short window. Ripple (XRP) futures are still down more than 7% on Bitmex while Ethereum (ETH) and Bitcoin (BTC) are double digits in the green. Retail investors seem to have lost interest in Ripple (XRP) after the whole JPM Coin announcement. However, the charts point to a strong breakout which means we should be on the lookout for events that will once again spark interest in Ripple (XRP) in the days and weeks ahead.
The daily chart for XRP/USD shows that it may not be easy for the price to recover so soon. XRP/USD is currently trading above the 50 day moving average but it has run into a strong trend line support turned resistance. This is made difficult by a long term descending trend line resistance. This confluence of strong resistance zones has made it difficult for XRP/USD to break out for now which means it is very likely that we might see further downside in XRP/USD. That being said, it is still expected to hold its ground better compared to Bitcoin (BTC).
Ripple (XRP) is well known for making independent moves as most of its investors have a mind of their own and they do not readily accept the dominance of Bitcoin (BTC) which often reflects in the price action of Ripple (XRP). If the same were to happen this time as we expect it to, then XRP/BTC might hold its ground while the cryptocurrency market declines in the weeks ahead. On the other hand, even if the market does not decline and continues to rally in the weeks ahead, the fact that Ripple (XRP) is massively oversold against Bitcoin (BTC) still makes it a better investment as it would have the most room to rally compared to other cryptocurrencies.