XRP Bull Flag Breakout Could Lead Price To $4, Analyst Says

By Investor Empires On Dec 13, 2024

This article is also available in Spanish.

One analyst explained how XRP could end up moving to the $4 level if its 4-hour price can break out of the recent bull flag pattern.

XRP has been integrated into the bull flag recently

In new mail On X, analyst Ali Martinez talked about how the 4-hour XRP price has formed a bull flag recently. The “bull flag” here refers to a pattern in technical analysis (TA) which, as the name suggests, looks like a flag on a pole.

The pattern is formed when the price of an asset follows a sharp upward trend with a period of consolidation towards the downside. The initial upward movement corresponds to the “pole”, while the consolidation period compensates for the “flag”.

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In flag patterns, this merging specifically occurs within a parallel channel. That is, between two parallel trend lines that represent successive peaks and troughs in the price. When trend lines converge, the pattern is known as a pennant.

The upper level of the flag will likely provide resistance to the price, while the lower level may act as support. A breakout of any of these trend lines could mean a continuation of the trend in that direction.

A bullish flag is considered a continuation pattern, so the probability of a breakout above the resistance level may be higher than the probability of a support line failing.

Like the bull flag, there is also a pattern called the bear flag. This works in the same way, except for the fact that the bar consists of a sharp movement down and the flag represents a short phase of consolidation towards the uptrend.

Now, here is the chart shared by the analyst that shows the bull flag that XRP has moved within recently:

It appears that the asset is currently retesting the upper line of the pattern | source: @ali_charts on X

As shown in the chart above, over a 4-hour period, XRP price saw a rise to the upper level of the bull flag consolidation channel. When the same test was repeated two days ago, the original found a rejection, but this is probably a good time to find a break.

However, Martinez noted that the cryptocurrency saw another signal alongside this retest: the completion of the Tom Demark (TD) on-chain sell setup.

The TD Sequential indicator is a TA indicator that basically indicates the possible locations of peaks and troughs in the value of any asset. It involves two stages, the first, which is known as setup, occurs after the price notices nine candles of the same color.