Ripple has formed lower highs and found support at the 0.2000 major psychological level, creating a descending triangle visible on its 1-hour chart. Price is currently bouncing off support and may be due for a climb to the resistance around 0.2400 as a small double bottom can be seen.
The neckline of this reversal chart pattern at 0.2200 has yet to be broken before Ripple makes its way up to the top of the triangle. However, the 100 SMA is crossing below the longer-term 200 SMA to signal that the path of least resistance is to the downside and that a break below support is possible. These moving averages are around the middle of the triangle, adding another layer of resistance.
Stochastic is turning lower from the overbought area to signal a pickup in bearish pressure. RSI, on the other hand, has some room to climb so Ripple might follow suit.
The triangle spans 0.2000 to 0.3000 so the resulting breakout in either direction could be of the same size. For now, it looks like consolidation could stay in play as the moving averages are oscillating.
The US dollar is trading lower across the board on dovish Fed rhetoric as a couple of policymakers expressed their cautious views on inflation and tightening. FOMC member Brainard called upon central bank officials to pay closer attention to underlying inflation trends to gauge if another rate hike is warranted while Kashkari blamed the recent tightening moves for hurting jobs growth and inflation expectations.
US equities have also closed lower on persistent fears of a North Korean missile strike. There have been no indications of tensions subsiding so markets are understandably on edge, driving demand for alternative assets or digital gold like bitcoin and Ripple.
If this kind of market environment persists, Ripple could be poised for more gains against the dollar, which is also being dragged lower by downbeat economic reports. US factory orders slumped 3.3% to record its steepest fall in three years while concerns about another hurricane ready to hit Florida are also dampening growth expectations.
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