Ripple continues to be the “under-rated player” in the cryptocurrency market.
Ripple can always be found high on the list of cryptocurrencies in terms of market capitalization and trading volume.
Currently trading at about $.25, with an all-time high of about $.40 made on May, 17, 2017, it’s still a bargain for investors looking for the long term, and has plenty of volatility for those traders that prefer the intra-day trading action.
Ripple is in the middle of forming a symmetrical triangle pattern very similar to the pattern that Ethereum recently broke out of.
The daily chart below (Chart #1) shows a very distinct symmetrical triangle that has been forming since early last June. Just like Ethereum, the pattern is converging on the apex of the triangle.
Both the downward trend line on the upper side of the triangle, and the upward trend line on the lower side of the triangle pattern have been touched by price action on four occasions after a price swing to the opposite side (Refer to Chart #1).
Chart #1: Ripple Daily
Normally, a symmetrical triangle pattern is indicative of uncertainty in the market with respect to which direction the breakout will take.
However, this circumstance warrants consideration of the fact that there is not much downside risk at a price of $.25.
Additionally, the overall cryptocurrency phenomenon is also something to be considered.
This market is reminiscent of the “dot com” era when companies with little to no intrinsic value simply put the characters “.com” behind their name, go public, and the Initial Public Offering (IPO) would “fly to the moon.”
With that in mind, there’s a strong likelihood that the breakout will be to the upside.
Chart #2: Ripple 5-Minute
Taking a more in-depth look at price action using the 15-minute chart above, we can see that price-to-volume patterns are not yet decisive in either direction.
The volume spikes are happening for both up and down price movements, as shown in the shaded area.
Furthermore, there is still enough room in the triangle for price to fluctuate to the triangle boundaries at least one more time.
The savvy trader will consider taking a long position the next time price bounces off the lower boundary of the triangle.
If the subsequent price upswing breaks through the upper boundary similar to the way Ethereum recently broke out, adding to the position on price dips would be prudent. We’ll be watching closely.
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Image courtesy of coinmarketcap.com
Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.