The price of XRP is showing signs of a potential breakout as it forms a classic Falling Wedge pattern, which a cryptocurrency analyst describes as an ideal bullish setup. Following a successful retest of a key buying zone, technical indicators suggest that XRP may be gearing up for a significant movement towards the $3.70 level in the near future.
According to Robert Mercer, a crypto analyst from TradingView, XRP is currently in a prime position for a breakout after a lengthy phase of consolidation. This technical configuration indicates that XRP could see a sharp increase from its current price of $2.25 to the target of $3.70. Mercer highlights that the cryptocurrency has been consolidating within this Falling Wedge pattern since late December 2024, establishing a local bottom at $2.11 during this period.
The price zone of $2.11 has proven to be a reliable horizontal support level throughout the six-month formation of the Falling Wedge, as XRP has tested this bottom multiple times without sustaining a drop below it. The cryptocurrency's price action is also gradually compressing within the wedge pattern, signaling diminished volatility and rising pressure near the apex of the wedge.
Mercer notes that XRP is approaching the upper boundary of the Falling Wedge, which aligns with the $2.45 resistance level, where a buying retest has recently occurred. This convergence is seen as a potential confirmation zone. If buying momentum persists and XRP closes above $2.45 decisively, this would confirm the end of the Falling Wedge and may trigger the next upward movement for the cryptocurrency.
Mercer emphasizes that XRP's current bullish setup is straightforward yet highly effective. Based on this configuration, price targets above the wedge are forecasted in stages, with resistance levels at $2.98, $3.36, and $3.71 determined by historical price movements and technical extensions. Should the breakout sustain and buying interest continues, the TradingView expert anticipates that XRP could reach the $3.5 to $4 range within the next three to five months, in line with previous performances following similar wedge breakouts.
However, while the current setup supports a bullish outlook, Mercer’s chart analysis indicates that a failed breakout remains a possibility. If XRP encounters resistance once again at the $2.45 level, it may revert to consolidating within the Falling Wedge pattern, applying downward pressure on the price and potentially leading to a retest of lower support areas.
In this bearish scenario, the most crucial support level is around $1.40. Although this level has not been directly tested in recent months, it represents the lower boundary of the Falling Wedge. A breakdown below this threshold could invalidate XRP’s wedge formation and bullish outlook, possibly indicating a shift from consolidation to bearish continuation, which could lead to further declines.
