Ripple (XRP) under threat
Ripple (XRP) has been one of the underperformers for the majority of 2019. However, it has also been a stalwart of sorts. It is trading in the same value area that it was back in October 2018 and has not changed much of its value since then. It experienced the same bullish drive that the crypto market experienced before topping out in late June – but has remained relatively calm since that period, neither underperforming or underperforming its peers. From a technical analysis perspective, Ripple is in a very precarious position – even at the time of writing this, I fear it could break down lower at any moment.Ripple (XRP) Weekly Ichimoku Chart
The chart above is Ripple’s (XRP) weekly Ichimoku chart. There are several conditions on this chart which scream danger. First, is the overall bearish nature of this chart with the Future Senkou Span A below Future Senkou Span B. The weekly Tenkan-Sen is well below the Kijun-Sen, and both of those averages are below the Cloud. Ripple is trading below both the Tenkan-Sen and Kijun-Sen as well as below the Cloud. The final technical piece that shouts danger is where the Chikou Span is at. It is currently below Cloud and the candlesticks. When both price and the Chikou Span are below the Cloud, and the Chikou Span is below the candlesticks, they create the strongest bearish conditions that can exist on an Ichimoku chart, on any timeframe. Sell-offs are almost a 100% certainty.
Except the sell-off has not occurred yet. In fact, when Ripple (XRP) previously had these exact conditions, it didn’t sell-off. This is an extremely odd condition to see on an Ichimoku chart. When I see this kind of behavior on a weekly chart, my first reaction is always to check a higher timeframe – the monthly chart. The monthly chart doesn’t help us. Ripple is still to new an instrument with an almost non-existent price history that it has not even existed long enough to show a monthly Kijun-Sen, much less a monthly Cloud. Given Ripple’s short history, we may be experiencing a potent support level that has yet to print – Ripple may not experience any further dramatic moves south. But when I look at the two week and three week Ichimoku charts (not shown), they all have a shared series of conditions: the Tenkan-Sen is below Kijun-Sen with price below the Tenkan-Sen, and the Chikou Span is below the candlesticks. On a weekly, two-week, and three-week timeframe, Ripple shows extreme bearish conditions.
The final straw that may break the back of Ripple could occur at any moment. As we ‘speed up’ the timeframes, we see an increasingly dangerous setup for Ripple (XRP). The daily chart shows Ripple just broke down below the Cloud on Friday (November 15th, 2019), and the Chikou Span is also below the Cloud. If Ripple drops down below $0.2480, a flash crash could occur. I am paying very close attention to these levels and have placed a series of limit buy orders at $0.20 and the extremes below, near the $0.15 and $0.12 value areas.