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XRP, the cryptocurrency behind Ripple, has been a hot topic lately, with analysts predicting a possible price increase of $11. However, before this can happen, XRP has to face a major challenge: a temporary price correction. Despite the positive long-term outlook, the stock is expected to face a pullback before any significant rally takes place.
The $2.73 resistance is currently a key level that XRP must overcome to continue its price movement. Crypto analyst Ali Martinez sees this resistance as crucial to the maintenance of XRP’s trend.
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Critical Success
A break at $2.73 and a follow-up move higher could open the door to seeing a move to the $11 digital asset. However, failure to do so could spell trouble for the coin, sending it down to a low of $2.05.
Given the highly volatile price range, investors are watching XRP’s movements closely to determine whether it will converge or correct.
$XRP it still includes within the pattern of the big bull pattern. Until the resistance of $2.73 is broken, a pullback to $2.05 remains possible before a possible breakout to $11! pic.twitter.com/ET39FJMtAc
– Ali (@ali_charts) January 4, 2025
Technical Perspective
In terms of technical analysis, some well-known analysts who follow the Elliott Wave Theory say that XRP is in a correction mode. Having gone through a five-wave cycle, they believe that XRP is now preparing for an ABC correction pattern.
This type of correction usually comes after a long rally and acts as a breather before the next big move. Some analysts expect the correction to end by mid-January 2024, thus giving sellers a good opportunity to buy before the new rally.
This correction may lower the price temporarily, but it may set the stage for a much larger increase in the coming months.
Bullish Sentiment
With all the associated risks of a short-term price correction, overall sentiment is still very bullish on XRP. One of the main reasons for this is the recent decision regarding Ripple’s long-running lawsuit with the US Securities and Exchange Commission (SEC).
The ruling in favor of this case removed a lot of uncertainty from XRP’s standing in front of the public and made it one of the most attractive currencies for many. Positive: Expectations of crypto-friendly policies from the government and not from the broader market, creating high momentum.
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A Bright Future For XRP?
Although a correction in the near term can be expected, the long-term outlook regarding XRP is still positive. If this correction plays out as expected, it could provide a good entry point for those interested in investing in the next potential rally.
The road to $11 is still ahead but if XRP continues on the same track, it will be a show to watch. As always, traders and investors need to remain vigilant in anticipation of key market resistance levels.
At the time of writing, XRP was trading at $2.41, up 0.1% and 15.4% on the daily and weekly periods.
Featured image from Trackinsight, chart from TradingView