Ripple fell rather hard on Monday to break down to as low as $0.57, before bouncing enough to form a bit of a hammer. The hammer is based around the $0.60 level, which is an area we have seen offer a little bit of support previously. Because of this, we could be trying to form some type of bounce, but risk appetite seems to be rather difficult.
Keep in mind that Ripple is pretty far out when it comes to the risk spectrum, so we need to see markets, in general, do much better. You need to see stock markets recover a bit, followed by the larger crypto markets such as Bitcoin and Ethereum. It is only at that point that Ripple will more likely than not be able to rally for any significant amount of time. Because of this, I anticipate that rallies will more than likely end up being selling opportunities. However, if you are a range-bound trader, you may have a nice short-term trade setting up.
The $0.70 level should be psychologically resistive, especially as the 50-day EMA is starting to break down and reach lower. Ultimately, it is not until we break above the $0.75 level that I would be impressed by any type of rally. Remember that Ripple still has the specter of the SEC lawsuit over its head in America, and that does put a significant damper on its outlook until we get through there. In that sense, Ripple has been an excellent range-bound trader for quite some time, and I think that will continue to be the case. After all, it is difficult to imagine that Ripple is going to suddenly rip higher until we can see it used in the United States.
On the other side of the trade is the $0.50 level. If we were to break down below the lows of the session on Monday, it could open up a significant attempt at trying to break down through the $0.50 level. If we were to do that, then it is likely that Ripple will start a bit of a freefall. This could be due to the influence of Bitcoin, so pay close attention to that market as well. It is trying to stabilize but has been rather lackluster as well.
