- XRP/USD Wasted Half of Its 2023 Gains
- Bearish Channel Shows More Weakness
- Bulls still need to hold $0.3 for hope
Cryptocurrency investors were thrilled to learn that the industry will make a big comeback in 2023. All major cryptocurrencies rallied in Q1, led by Bitcoin.
XRP/USD also rose. After trading as low as $0.30 in early 2023, it nearly doubled by the end of the first quarter.
A combination of the prolonged weakness of the dollar and the enthusiasm of the cryptocurrency industry contributed to the rally. The Fed also had the idea of pausing rate hikes as inflation cools.
However, the depreciation of the dollar has stopped, not continued. Moreover, the trend reversed in the second quarter, with the dollar rising so far.
And which markets have seen the most corrections? Some of the biggest gains include cryptocurrency markets.
XRP/USD In Danger of Breaking Out of $0.3 Support Area
The technical situation seems increasingly concerning for XRP/USD. Despite the Q1 2023 rally, XRP/USD remains bearish.
Given that the bear channel remains intact, it seems that this rally was nothing more than a bear market rally. In fact, the market failed where expected, with resistance from earlier support.
If the market breaks below the bearish channel (i.e., below $0.3), the projected movement of the measure points to continued decline towards the $0.2 region. In that case, the bearish channel is nothing but a continuation of the bear market that started with the double top pattern in late 2021.
Overall, the market must hold within the channel for the bulls to still have hope. It would be nice to try the $0.6 resistance area once again, but the increased probability of a break below $0.3 and the bearish implications of such a move should not be ignored.