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XRP, the fifth largest cryptocurrency by market capitalization, has shown a bullish sign on its daily charts.
The 50-day moving average (MA) of XRP has crossed above the 200-day MA, forming a pattern known as a “golden cross”. This indicates a possible change in the long-term trend from bearish to bullish.
This is the second time this year that XRP has witnessed a golden cross on its daily chart. The previous one occurred in April, followed by a rally of over 200% in the next two months.
XRP/USD Daily Chart, Courtesy: TradingView
The golden cross comes after XRP experienced a death cross in late September, when the 50-day MA fell below the 200-day MA. However, instead of a prolonged downtrend, XRP bounced back from the Oct. 19 low of $0.47 and started to climb higher.
XRP outperformed Bitcoin and other major cryptocurrencies on Monday, surging by 15%. It extended its gains in the past week, reaching a high of $0.732 on Nov. 10.
At the time of writing, XRP was trading at $0.69, up 0.69% in the last 24 hours, after retracing some of its earlier gains.
The golden cross is often considered a positive signal by traders and analysts, as it suggests that the market sentiment has turned bullish. Therefore, the current golden cross may attract more buyers who follow the trend, leading to further price appreciation.
However, it is important to note that golden crosses are not infallible, as they can sometimes be false or lagging indicators. This means that the market may have already reached an overbought condition and is due for a correction before or after the crossover happens.
XRP faces an immediate resistance at $0.732, which is the recent high. If it breaks above this level, it may target the next resistance at $0.853, which is the high of May 2021.
