XRP, the fourth largest cryptocurrency by market capitalization, recently experienced a significant technical development on its hourly chart — the formation of a “death cross.” This technical signal occurs when a short-term moving average crosses below a long-term moving average, indicating potential bearish momentum. Specifically, XRP’s 50-hour moving average dipped below the 200-hour moving average, marking the appearance of the death cross. For many traders, this pattern is seen as a sign that the price could face downward pressure in the short term.

The death cross often raised concerns for traders and analysts, as it signals a shift in market sentiment, typically indicating that the asset could experience further declines. However, it’s essential to note that while the death cross is widely regarded as a bearish signal, it’s not always a definitive predictor of future price movements, particularly in highly volatile markets. Technical indicators, such as the death cross, are meant to provide insights but can sometimes give false signals, especially during periods of extreme price fluctuations. As such, investors must consider other factors alongside this pattern before making trading decisions.

XRP’s recent price action provides some context for this development. The cryptocurrency has been struggling to maintain upward momentum in recent days. After reaching a high of $2.62 on March 7, XRP has seen a decline in its value, dropping to $2.31 as of Sunday morning, reflecting a 1.3% decrease in the last 24 hours. This price drop aligns with the broader market volatility and a general pullback in the cryptocurrency space, particularly following the Crypto Summit on Friday. Hopes that XRP would be included in the U.S. strategic crypto reserve faded after the summit, contributing to the bearish sentiment surrounding the cryptocurrency.

The hourly death cross signal has raised concerns that XRP might continue to face downward pressure, particularly as the broader market sentiment remains uncertain. However, some analysts suggest that the current price action could also be a part of a consolidation phase. XRP is currently trading within a symmetrical triangle pattern, a formation that often precedes significant price movements in either direction. Traders are closely monitoring this setup, as a breakout from this triangle could signal a sharp price move.

If XRP manages to break to the upside, the first significant resistance level would be around $3. A push above this level could see XRP rally toward $3.40, but this will not be an easy task. Sellers are likely to defend the $3.40 mark vigorously, and if they succeed, XRP’s rally may stall. If the upward movement continues and the resistance is breached, there is potential for a more substantial price increase, possibly targeting the $5 mark. However, if the price fails to break the symmetrical triangle to the upside, the bearish death cross could have more significant consequences.

In the event of further downside, XRP could test support levels around $2.20. Should this level fail to hold, the cryptocurrency may experience a deeper decline, possibly retesting support at $1.79 or the daily 200-SMA at $1.60. Despite the technical concerns, many buyers are expected to defend these lower levels, potentially preventing a more severe downturn. The outcome will likely depend on whether XRP can hold these critical support zones or if the death cross proves to be a sign of deeper losses.

While the formation of the death cross indicates bearish momentum in the short term, XRP investors remain hopeful that the cryptocurrency can recover and break out of its current consolidation phase. The market will need to keep an eye on key levels of support and resistance in the coming days to understand whether XRP can resume its upward trajectory or face further declines.