On Monday, XRP’s value plummeted as the cryptocurrency market faced intensified selling pressure, with technical indicators suggesting a potential drop to $1 or lower.
The cross-border token, Ripple (XRP), reached a low of $1.6185, marking its lowest price since November of the previous year.
This decline was driven by an ongoing cryptocurrency collapse precipitated by Donald Trump’s recent speech on Liberation Day tariffs. The resulting tensions with China have led many analysts to foresee a recession in the U.S. within the year.
Analysts at Goldman Sachs raised their recession predictions to 45%, a notable increase from 35% just a week prior. Furthermore, experts from JPMorgan, Wells Fargo, and Citi have cautioned that a prolonged economic downturn is likely unless Trump revises his stance on tariffs.
On a brighter note, a recession could potentially serve as a positive catalyst for both cryptocurrencies and other risk assets, as it may prompt the Federal Reserve to lower interest rates.
However, several prominent crypto analysts are warning of a potentially extended market slump. Ki Young Ju, founder of CryptoQuant, cautioned that the current cryptocurrency downturn could linger for somewhere between 6 to 12 months.
Technical indicators suggest further decline for XRP’s price
The daily chart indicates that Ripple has continued its recent downward trajectory, settling at $1.6185—over 52% lower than its peak this year.
During this decline, the coin breached multiple critical support levels. Significantly, it fell below the psychologically important $2 mark, which had been strongly defended by bullish investors for several months. Additionally, it dropped below $1.9193, the 50% Fibonacci Retracement level, and the neckline of a head and shoulders pattern.
A head and shoulders pattern is a widely recognized reversal formation indicative of bearish trends, comprising three peaks: the head (in this case at $3.4220) and two shoulders (at $3). A drop below the neckline typically validates the bearish momentum.
Compounding the situation, Ripple’s price dipped beneath $1.80, where it previously saw a false breakdown in February. It has also formed a death cross pattern, indicating a significant trend shift, as the 50-day and 200-day Weighted Moving Averages have reversed positions.
The Weighted Moving Average reacts more swiftly than exponential moving averages because it prioritizes recent data. Additionally, XRP has fallen below the weak stop & reverse level as indicated by the Murrey Math Lines.
Considering these technical factors, the most probable outlook suggests that Ripple’s price may sink below the $1 psychological threshold, potentially reaching $0.9340. This target is calculated by assessing the distance from the head to the neckline and then applying that same distance downward from the neckline.