XRP has recently shown signs of a possible trend reversal, although it is still under the influence of a broader bearish divergence. Over the past 24 hours, XRP briefly fell below the critical support zone between $2.25 and $2.30. However, it hasn’t confirmed a daily close beneath this range, allowing a glimmer of optimism for the bulls. While this bounce might fuel short-term hope, it does not guarantee that the bearish divergence is over, as larger time frames still show signs of a downtrend.

Current Price Action

Despite the bounce in XRP’s price, the overall market sentiment remains cautious. The larger bearish trend is still intact, and this short-term recovery might not be enough to turn the market’s direction for the long haul. Therefore, although a temporary uptrend is possible, traders must remain vigilant, as larger price movements could still challenge any upward momentum. The market could face further downward pressure if the broader bearish trend continues to exert influence over the price.

Analyzing Key Support and Resistance Zones

At present, XRP is encountering significant resistance in the $2.30-$2.46 range. This zone is a crucial pivot point for the asset, where a breakout could signal the beginning of a bullish trend. If XRP successfully surpasses this resistance, it could initiate a substantial rally. However, a failure to breach this zone would imply that the bearish trend might still hold sway, leading to further downward pressure on the price.

The immediate support level being closely monitored is at $1.95. If XRP manages to hold above this level, the price could see a continuation of its upward movement. However, if the price falls below this threshold, the market might experience more significant corrections. In that case, traders will be eyeing the next key support level, which is the February low of $1.77. If this level holds, it could provide an opportunity for a rebound, but if breached, further downside could be expected.

Bullish Scenario: What Could Trigger a Strong Uptrend?

In a bullish scenario, if XRP breaks through the $2.46 resistance level, it could pave the way for a significant price surge. A move toward the $5 to $6 range would indicate that a strong uptrend is taking place, offering an appealing reward-to-risk ratio for investors. Such a rally would likely occur in a five-wave pattern, signaling that the market has found a solid bottom and is ready to embark on a new upward trajectory.

If XRP manages to break the $2.83 resistance, it would validate the bullish outlook, confirming that the bearish divergence has been fully negated. This breakthrough would help solidify confidence in the market, attracting more buyers and driving the price higher.

Potential Risks: Bearish Reversal

On the flip side, if XRP fails to break above the $2.46 resistance, the price might continue to struggle and face more downside risk. The bearish divergence could continue to exert influence, pulling the price lower toward the $1.95 support level. If this support doesn’t hold, the market could experience a deeper correction, with the next support point lying around the $1.77 level.

Conclusion

XRP’s price is at a crucial juncture, as it tests important resistance and support levels. While the asset has shown some signs of a potential trend reversal, the larger bearish trend is still a major factor. A successful breakout above $2.46 could trigger a significant rally toward $5-$6, offering a substantial profit opportunity for investors. However, traders must remain cautious of the ongoing bearish divergence, as failure to break through key resistance levels could result in further downside risks. The $1.95 support remains pivotal in determining whether the bullish momentum can continue or if the market will face additional challenges.