An analyst has explained a dream scenario for XRP based on a Bull Flag that the cryptocurrency has potentially been following on the monthly chart.
XRP Could Be Trading Inside A Bull Flag Pattern
In a new post on X, analyst Ali Martinez has discussed about how XRP has been forming a Bull Flag recently. The “Bull Flag” is a type of Flag from technical analysis (TA).
A Flag pattern looks like, as its name suggests, a flag on a pole. A consolidation channel with two parallel trendlines forms the “flag” portion, while an initial sharp move represents the “pole.” In a Bull Flag, the pole is charted by a move in the up direction.
Generally, Flags are considered to be continuation patterns, meaning that a breakout tends to happen in the same direction as the preceding trend. In a Bull Flag, as the pole corresponds to a rally, the breakout move is also in the bullish direction.
Like the Bull Flag, there is also a pattern in TA called the Bear Flag, appearing when the pole is made up by a sharp downward move. Naturally, the breakout is considered more probable in the down direction in this case.
Now, here is the chart shared by Martinez that shows the Bull Flag that the 1-month price of XRP has possibly been traveling inside for the past year:
As displayed in the above graph, XRP is currently trading inside the consolidation channel of the Bull Flag. Martinez has noted that a dream scenario for the cryptocurrency could now be to retest the $1.90 level, then observe a rally that ends in a bullish breakout.
The $1.90 mark is where the lower level of the flag channel is located. This level usually acts as a support barrier, helping keep the price above it. A rebound at this level could be the spark to a run to $10, according to the analyst.
This target is based on the fact that a Bull Flag breakout is considered to be of the same height as the pole. It now remains to be seen whether XRP will find a break beyond this flag, and if it will follow a path anything like that charted out by the pattern.
The 1-month price isn’t the only timeframe on which XRP is trading inside a parallel channel right now. As Martinez has pointed out in another X post, the 3-day price is also stuck in a similar consolidation pattern.
“If this bull run keeps going, XRP could offer a solid buying opportunity at $1.90 before rallying to $6,” said the analyst, based on this pattern.
XRP Price
At the time of writing, XRP is trading around $2.53, up 10% over the last 24 hours.
