Ripple continues to trend lower after completing a downside break of support. Price is trading below a descending trend line connecting the highs since July 9.
Price is finding support around 0.1750 and could be due for a pullback to the trend line. Applying the Fibonacci retracement tool on the latest swing high and low shows that the 61.8% level coincides with a former support level near the 0.2000 major psychological mark.
Meanwhile, the 100 SMA is close to the descending trend line, adding to its strength as resistance. A larger correction could still hit the ceiling at the 200 SMA near 0.2200, and a break past this level could signal that bulls are regaining control.
Stochastic is pointing down to signal that sellers are regaining control of Ripple action even without hitting overbought levels. RSI is still pointing up, though, so there may be some buying pressure left.
The US dollar has enjoyed a big boost upon seeing stronger than expected non-farm payrolls data for June and May. This reinforces Fed interest rate hike prospects for either September or December even while the central bank begins its balance sheet reinvestments.
Cryptocurrencies like Ripple have also been on the back foot as concerns about the bitcoin hard fork resurfaced. The company behind Ripple is focused on building a better bitcoin as it wants to handle transaction volume on a higher scale. The company approaches banks with its enterprise software, along with the Interledger Protocol. They propose a corresponding banking paradigm in which banks with no direct relationship rely on intermediaries in order to send payments to each other.
Looking ahead, Fed Chairperson Yellen’s speeches this week could make or break the dollar’s rally against Ripple. Traders are hoping to get more hawkish remarks owing to the strong jobs report, but there’s always a chance that she could highlight the weakness in inflation. In any case, additional volatility could be seen during her testimonies and this might open retracement opportunities for Ripple.
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