An analyst has explained how XRP could eventually reach a $4.40 price target based on the bull pennant pattern that has formed in its 4-hour price.
XRP Has Just Shown Its Third Straight Bull Pennant Pattern
In a new post on X, analyst Ali Martinez has discussed the bull pennant patterns that have formed for XRP recently. The “bull pennant” refers to a formation from technical analysis (TA) that occurs after an asset shows consolidation inside a triangle following a sharp uptrend.
The pattern is made up of two parts: a pole and a ‘pennant.’ The pole corresponds to the initial uptrend in the asset’s price. This is exactly the same kind of structure that precedes the consolidation phase in a “bull flag.”
Where a bull pennant diverges from a bull flag is in terms of how the consolidation of the asset occurs. In a flag, the price moves between two parallel lines, while in a pennant, it’s between two converging trendlines.
The upper line of the pennant is likely to be a source of resistance, meaning tops can probably occur at it. Similarly, the lower line may support the price.
A break out of either of these levels can suggest a continuation of the trend in that direction; escapes above the pennant are bullish, while falls under it can lead to a bearish outcome.
Like the bull pennant, a ‘bear’ pennant can also form in an asset’s price. This pattern works very much like the bull pennant, except for the fact that its pole corresponds to a downtrend instead.
Now, here is the chart shared by the analyst that shows the bull pennant that XRP is traveling inside right now:
As is visible above, XRP attempted a retest of the pennant upper level yesterday, but the asset appears to have found rejection as its price has gone down since then. It’s possible that the coin may find support at the lower level next, which is located at $2.25.
The cryptocurrency is slowly moving towards the apex of the pattern, meaning a break in either direction might be on the cards in the near future. As for which of the two directions is more likely, perhaps history may hold the answer.
From the chart, it’s apparent that this isn’t the first bull pennant that the asset has shown during the past month. Both of the previous two instances ended in the price finding a bullish breakout. Thus, XRP may obtain a similar outcome this time as well.
As for how far the break might take the asset, Ali has mentioned a target of $4.40. This is based on the fact that pennant breakouts are generally of the same length as the pole. “We should all be praying for a retest of $2.25 to buy the dip and target $4.40!” says the analyst.
XRP Price
Following its drawdown during the past day, XRP has plunged to the $2.39 level.
