Top ten ranked cryptocurrencies by reported market cap, XRP, and Stellar Lumens (XLM), have recorded losses this week that have retraced the majority of the increases last week.
The failure of their prices in following up on the strong performance recorded last week is a bearish sign.
Prior to the rise last week, the price of XRP underwent a consolidation for almost three months above support at $0.295.
The price drop experienced this week brings it back towards this point.
We may see an extension of the consolidation we experienced prior to the increase last week and the odds of price dropping below $0.295 will increase if this happens given the failure of XRP to hold higher valuations.
A bearish divergence preceded the price drops seen this week.
The majority of the losses were suffered on Thursday as most major cryptocurrencies underwent drops on this day.
Price action recorded a Doji candle from yesterdays price action and is also forming a Doji candle today.
A Doji candle reflects uncertainty from traders.
The consolidation over the past two days increases the likelihood that we will see a follow-up decline from Thursday as the price has failed to bounce and trade at higher valuations.
$0.313 is an important level to monitor below price also and was also an area of much consolidation prior to the price increases of last week.
Stellar Lumens (XLM) is recording similar price action to that of XRP.
XLM has reversed the majority of the increases recorded last week.
XLM also formed a bearish divergence between the price and RSI prior to the steep drops seen this week.
Since the significant drops that were seen on Thursday, XLM has recorded two small-bodied candles on Friday and Saturday and is so far forming a Doji candle today.
Similarly to XRP, this increases the likelihood of a follow-up drop given the failure of XLM to return to higher valuations quickly.
$0.108 the next key support level to monitor for XLM and has acted as both support and resistance in prior price action.
$0.1 is also a level to monitor given its significance as a round psychological point for traders, and it was also an area of buyer liquidity during drops in late March.
- Both XRP and XLM retrace the majority of the increases recorded last week.
- Bearish divergences on the daily chart formed for both prior to the drops.
- The majority of the drops were recorded on Thursday this week where most top cryptocurrencies recorded losses.
- Prices have since been consolidating since the significant drop on Thursday increasing the likelihood of a follow-up drop.
Bearish Divergences Preceded Price Drops in Stellar and XRP [Price Analysis] was originally found on Cryptocurrency News | Tech, Privacy, Bitcoin & Blockchain | Blokt.