Ripple previously broke above a long-term descending trend line to signal that a reversal is underway. Price seems to be stalling on its climb and could use a pullback to gather more bullish energy.
Applying the Fibonacci retracement tool on the latest swing low and high shows that the 61.8% level lines up with the broken resistance that might now hold as support. If so, XRP could resume the climb to the swing high at .4000 or higher.
However, the 100 SMA is still below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. In other words, there’s still a stronger chance that the downtrend would resume than reverse. Then again, the gap between the indicators has narrowed enough to signal weaker selling pressure.
RSI is turning lower after indicating overbought conditions, which suggests that buyers are tired and that sellers could take over. Similarly stochastic is turning south from the overbought zone so price might follow suit while bears regain the upper hand. A break below the Fibs could signal a continuation of the slide.
Cryptocurrencies are retreating from their rallies along with the rest of higher-yielding assets as risk aversion returned after the FOMC statement. The central bank indicated scope for further tightening next year, which simultaneously boosted the dollar on higher rate expectations and lifted its safe-haven appeal on increased borrowing costs.
Besides, coins appeared to be overdone with the latest upside breakouts and rallies, leading to corrections. Buyers have been quick to book profits, after all, as there is still some degree of caution in the markets and doubts that gains might not be sustained. Nonetheless, if any of the support areas hold, the uptrend might still gain traction later on.