Over the weekend, XRP delivered a textbook technical reaction, perfectly tapping the macro 0.5 Fibonacci support at $2.03. This level has been closely watched by traders, and the market’s response did not disappoint. The touch of this support has now triggered bullish divergences, signaling the possibility of a short-term bounce.
From a wave-structure perspective, the current move appears to be setting up a subwave 2 recovery, with an upside target near $2.26. While this bounce is constructive, it is also a critical decision point for XRP’s next major direction.
Why This Bounce Matters
The coming move higher will reveal whether XRP is entering a genuine bullish continuation or simply completing a corrective structure. If price action remains corrective in nature, the risk of a sharp rejection remains high. Such a rejection could initiate a subwave 3 decline, potentially breaking below the $2.03 support and opening the door toward the macro support near $1.65.
This is why traders must closely monitor market behavior rather than assume the bounce guarantees strength.
Bullish vs Bearish Scenarios
Bearish Scenario:
If XRP fails to hold above $2.03, a breakdown could accelerate downside momentum. A confirmed loss of this level would increase the probability of a deeper move toward $1.65, a major macro support zone.
Bullish Scenario:
A strong break and sustained move above $2.41 would invalidate the bearish outlook. Such price action would suggest that the bounce is impulsive rather than corrective, signaling renewed bullish strength.
Key Levels to Watch
Support Levels:
$2.03 (current critical support)
$1.65 (macro support)
Resistance Levels:
$2.26 (subwave 2 target)
$2.41 (key invalidation level)
Trading Strategy Outlook
Risk management remains essential at this stage. A stop-loss just below $2.03 helps protect against sudden breakdowns. Traders should observe whether the upward move forms a corrective ABC structure, typical of a Wave 2, or transitions into an impulsive rally. Even a double-top formation near $2.41 would still align with the corrective scenario.
Final Thoughts
XRP has reached a technically significant level with precision. Now, the market must prove its intent. Whether this move becomes the foundation for a new rally or a pause before deeper downside will be decided in the next wave.
The levels are clear. The structure will tell the story.