XRP’s price is up 5% month to date in September at the time of this writing. But it could be setting up for a major pump through October.
Compared to the leading cryptocurrency, Bitcoin, the altcoin posted higher gains mid-way through September. Bitcoin grew by 2.5% over the same period that XRP gained 5%.
Meanwhile, the leading smart contract currency, Ethereum, posted gains of 4%. So Ripple’s borderless payments currency is outrunning its biggest competitors so far in September.
Bitcoin appeared especially sensitive to the fresh CPI report out on Sept. 11, dropping by about a thousand dollars in price in crypto markets immediately following the latest printout.
Ethereum is seeing some positive signs in mid-September, like heightened on-chain volume. But it is also playing catch-up after experiencing nearly one billion in outflows the first week in September.
As a result, XRP has taken the lead in price gains among the top three cryptos by means of total market capitalization month to date. Moreover, it may be setting up for a massive bull run through the end of the month into October.
Here are three signals that support this thesis.
XRP prices were on the way up at the time of this writing from a chart trend line convergence on Sept. 1. That signaled a possible bullish reversal from a medium-term falling wedge pattern.
This chart indicator often signals that a rally is about to begin.
Currently, the price chart shows lower highs under a descending trend line, with key resistance levels staying above a slightly declining line of key support.
In XRP’s case, if we zoom in to the Q3 chart, the altcoin’s price traces a falling wedge beginning around July 20th and running about 40 days through September 1st, where the trendlines converge and indicate a bullish breakout.
The falling wedge bears the classic sign of declining daily trading volume that accompanies true bullish reversal signals out of this shape on the chart.
Markets confirmed the breakout after September 1st and 4th, pushing the XRP price up to $3.12 by September 13th, before settling to around $3.03, where it currently trades.
The last falling wedge in XRP price from Jan. 17 to Apr. 8 lasted around 80 days and preceded a gradual and then sudden bullish rally from Apr. 8 until the most recent pattern began on July 20.
During that time, XRP moved from $1.79 to $3.46. That represented a gain of 93% in 102 days. That’s an average annualized return on investment (ROI) of 333% for Q2 and Q3.
In addition to the falling wedge breakout in September, there is another bullish technical indicator. XRP’s price has seen significant psychological resistance at the $3 level.
The decisive breakthrough to $3.12 on Sept. 13 indicates the bulls’ ire in XRP markets, which are on the brink of making this break.
Psychological support and resistance occur in volume exchange markets for liquid fungible goods like stocks and cryptocurrencies at lines around nice round numbers that humans can get a handle on.
That’s because of information feedback loops that happen when stock and altcoin traders are all looking at the same price chart for a good they’re trading and using it as a factor in their decision-making.
They notice that trend channel boundaries are more directly related to supply and demand, but they also see the mile markers along the highway.
As a result, markets like these see clusters of trading activity around these lines of psychological support and resistance.
As a recent note by Fidelity’s Trading Strategy Desk says:
“These support and resistance levels are seen by technical analysts as crucial when determining market psychology and supply and demand.”
The two signals listed above are specific to XRP’s price market and an analysis of the leading technical indicators on its chart.
These are reasons why XRP is looking even better than Bitcoin and Ethereum in September for a Q4 rally. Though they are no guarantee of XRP’s market movements, they are consistent with chart patterns that historically produce rallies and big green candles, so to speak.
But the rocket fuel for an XRP price rally in Q4, if it happens, would be the tidal macro forces of the September US Fed rate cut announced on Wednesday, Sept. 17.
Bitcoin is a larger market than XRP and a more networked exchange with more varied participants, who are savvy to news and finance. Commentators have been saying the Fed rate decision is already baked into Bitcoin’s price.
Meanwhile, the added USD velocity and mass from new supplies to hit the Fed’s latest interest rate target will provide plenty of central bank credit liquidity for traders interested in accumulating XRP.
Rate cuts to the central bank currency are usually good news for riskier assets like altcoins. AI chatbot ChatGPT recently called the outlook bullish for XRP after a Fed rate cut in September.
