Ripple broke past its descending trend line resistance to indicate that a reversal from the downtrend is in order. Price found resistance at the 0.3000 mark and is making a correction to the nearby retracement levels.
Applying the Fib tool on the latest swing low and high shows that Ripple is finding support at the 50% retracement level but might still pull back to the 61.8% level near the 0.2000 major psychological level. If any of these levels keep losses in check, Ripple could find its way back to the swing high or higher.
Stochastic is turning down from the overbought level to signal a return in selling pressure. RSI is also turning lower from the overbought zone so Ripple might follow suit. The 100 SMA is crossing above the longer-term 200 SMA so the path of least resistance is to the upside. These moving averages are close to the broken descending trend line, adding to its strength as potential support.
Bitcoin is currently under pressure as hard fork issues may be resurfacing on stronger network acceptance of bitcoin cash. It has been reported that this rival version generates new blocks at 1-2 minutes faster compared to the original core version so miners are shifting to bitcoin cash, forcing bitcoin to retreat off its highs.
Other cryptocurrencies have been able to take advantage of this drop, just like Ripple. 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.
The dollar is also being weighed down by political rifts in Washington, casting more doubts on the administration’s ability to power through with its fiscal reform agenda. North Korean jitters are also resurfacing after Pyongyang viewed the joint military drills between US and South Korea as an act of provocation. A continuation of risk-off flows could benefit Ripple as cryptocurrencies tend to attract investor interest during these scenarios.
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