Ripple (XRP) price has been under significant pressure following a series of bearish technical signals and legal developments. Following the SEC's appeal against Ripple, XRP experienced a sharp decline. However, the RSI has moved from deeply oversold levels, indicating that selling pressure may be easing, although the overall trend remains bearish.
XRP's RSI is currently sitting at 41.60, a notable jump from its deeply oversold level of 19.79 on October 3. This increase signals that intense selling pressure seen earlier in the month has eased, with some buyers stepping in. However, this upward shift in RSI does not necessarily indicate a reversal of the downtrend; rather, it suggests that the asset has moved out of extremely oversold territory and is experiencing a potential relief rally.
The Relative Strength Index (RSI) is a momentum oscillator used in technical analysis to measure the speed and magnitude of recent price changes. It ranges from 0 to 100, with key thresholds at 30 and 70. An RSI below 30 indicates that the asset is oversold and may be due for a rebound, while an RSI above 70 means the asset is overbought.
An RSI of 41.60 implies that XRP, while still in a downtrend, is seeing some stabilization as the market has cooled off from extreme selling. This level indicates that bearish momentum is weakening. However, buyers haven't gained enough strength to fully reverse the trend. In the context of XRP’s ongoing downtrend, an RSI around 40 suggests that while the asset isn't oversold anymore, it is still under selling pressure.
Traders typically view RSI levels in this range as neutral or slightly bearish, meaning there may still be room for downward movement unless significant buying pressure emerges to push the RSI toward 50 or higher. For XRP price to break out of its downtrend, stronger bullish signals and an RSI above 50 would be needed to confirm a potential trend reversal.
The XRP DMI chart shows that the current market sentiment is dominated by bearish momentum. The blue line, representing the Positive Directional Index (+DI), is at 11.16, indicating weak buying pressure. In contrast, the red line, or Negative Directional Index (-DI), is higher at 24.55, suggesting stronger selling pressure. This imbalance reflects a clear downtrend in XRP’s price movement.
The Directional Movement Index (DMI) is a technical indicator used to assess the strength of a trend. It consists of the +DI and -DI and the Average Directional Index (ADX), which measures overall trend strength regardless of direction. Currently, the ADX is at 38.29, signaling that the bearish trend is relatively strong.
On October 2, XRP's EMA lines formed a death cross, a significant bearish signal indicating that a prolonged downtrend could be on the horizon. Since the death cross, XRP’s price has dropped by 13%. If XRP continues to follow this negative trend, the price could potentially drop to $0.43, representing a 17% decline from current levels. However, if XRP can reverse the bearish momentum, it may retest resistance at $0.61, and if this resistance is broken, it could push XRP price toward $0.66, representing a potential 26% upside from the current price level.
