XRP has been a top performer during this recent bull market, beating Ethereum and almost all other cryptocurrencies in ROI. But could a recent bearish signal suggest the top altcoin could drop by 70-80% from current levels?
XRP monthly LMACD has crossed bearish for the third-time ever
The two past bearish crossovers resulted in an 87% and 71% drawdown AFTER the signal fired
Aside from Bitcoin, altcoins haven’t fared well during this recent bull market cycle in crypto. XRP, however, has done extremely well, even outperforming BTC at times. But as Bitcoin itself begins to struggle with selling pressure, XRP has triggered a high timeframe bearish signal that could also point to the end of the ongoing rally.
XRPUSD has triggered its third-ever bearish crossover of the LMACD indicator on the one month timeframe. High timeframe signals tend to hold more weight than lower timeframes, making the bearish crossover especially worrying.
LMACD stands for logarithmic moving average convergence divergence indicator. It helps traders to visualized momentum swings from bearish to bullish and back again. The histogram turning red indicates that the two moving averages (the LMACD line and the signal line) have crossed bearish.
These bearish crossovers of the monthly LMACD are usually devastating in their wake. The first instance of the signal firing was in 2018 – XRP fell by 87% after the bearish crossover. The second bearish crossover was in 2021 and XRP dropped by 71% in the following drawdown.
A 70% drop from current prices would put XRP back at around 70 cents per coin. Meanwhile, many crypto analysts are still expecting prices near $10 or higher. There is no guarantee either price target will be hit, but there’s no denying based on the indicator that momentum is turning bearish.
