XRP price is demonstrating a comeback pattern as the digital coin looks to find stability above the $1.30 mark, whereas a bullish technical setup marked out by crypto analyst Ali Martinez is pointing towards the $2 level if the resistance zone breaks.
At the time of writing, XRP is trading at $1.32, with a 24-hour trading volume of approximately $4.02 billion and a market capitalization of about $83.03 billion. The token has gained 1.54% over the last 24 hours.
Market data also shows XRP price recovering from the sharp decline seen earlier in the week. The current movement in price comes amid XRP price still being below the $1.55 range, which has turned into a critical technical level for the coming major move.
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XRP Targets With Inverse Head-and-Shoulders Setup
As of September 18, Ali Martinez highlighted the formation of an inverted head-and-shoulders pattern on XRP’s daily time frame.
Based on Martinez, XRP’s price seems to be forming the right shoulder of the pattern, with its neckline positioned around the $1.55 price point. A break above this level will confirm the formation of the technical pattern.
The technical trade set up by Martinez targets a 35% move to $2 following a confirmed breakout above the neckline. This is a measured move on the inverted head and shoulders pattern and not necessarily the target for XRP price.
This level is critical for XRP since it will have to cross this level for the formation to be technically validated. The question at hand for XRP price now is whether or not the buyers can force the price higher towards $1.55.
XRP Price Remains Below the Bollinger Middle Band
According to the technical analysis, the cryptocurrency has not been able to break the resistance line, even after its recent bounce.
XRP is currently trading at $1.32050, which is beneath the midpoint of the Bollinger Bands at $1.36755. The upper Bollinger Band is at $1.45947, whereas the lower Bollinger Band is at $1.27564.
The crossing above $1.36755 would be seen as a signal that the token may be becoming stronger in the short term and that it may be able to test $1.45. Crossing above $1.45 would shift the focus to the $1.55 neckline noted by Martinez.
From the downside, it is worth noting that $1.27564 is a key level. A cross below the lower Bollinger Band would weaken the existing recovery formation.
The MACD indicator also indicates that XRP still has not regained its lost momentum. The MACD stands at about -0.01967, while the MACD line, which is standing at 0.00886, is below the signal line, which stands at 0.02852. This negative histogram suggests that there is still downward momentum despite XRP’s past rally.
A bullish crossover of the MACD would add one more technical confirmation to rising momentum.
Evernorth Adds Institutional XRP Buying Potential
A technical setup is being made concurrently with another development in the sphere of XRP.
Evernorth, which is an XRP-centered treasury company in the preparation of its listing at Nasdaq, has agreed to the issuance of $30 million of 4% convertible senior PIK notes maturing in 2031 to NH Investment & Securities, which will serve as a trustee for Kyobo AIM Corporate Finance General Private Investment Trust No. 3.
Evernorth has expressed that the capital raised could be invested in XRP and all activities surrounding the XRP ecosystem. Therefore, the capital raises an additional avenue through which there could be institutional interest in purchasing the token, but the money raised does not immediately mean a $30 million spot purchase of XRP.
This aspect is crucial since the note financing will depend on the corporate transaction, which means that the capital raising is conditional on the corporate transaction taking place.
The proposed deal by Evernorth is now inching towards its next big step. The registration statement for the company was declared effective in August, while shareholders of Armada are set to decide the fate of the deal on September 30. Upon closing, the combined company will list on Nasdaq with the symbol XRPN.
What Happens Next for XRP Price?
The upcoming sessions may reveal whether the $2 target will become a technically confirmed pattern or not.
A break above $1.55 with the presence of buying interest will be bullish for the inverse head-and-shoulders pattern and also make the $2 area valid according to the measured move calculation by Martinez.
However, the inability to take out the resistance level at $1.37 and moving below the support at $1.27564 will signal more weakness ahead and suggest the need for additional work on the $2 target.
Meanwhile, market participants will be keeping an eye on the shareholder vote at Evernorth scheduled for September 30th. The completion of the proposed merger will bring the company one step closer to its Nasdaq listing and may signal the timing of the new convertible financing arrangement.
For the time being, XRP’s narrative consists of two different stories: a technical rebound attempt towards the $1.55 breakout level and an institutional treasury buildup of XRP.
The point here is that the level of $1.55 continues to be the important technical one. The breakout of this level will trigger the $2 target suggested by Martinez, while not being able to break out of this level will keep XRP in its existing recovery range.
As for the funding of Evernorth at $30 million, it is another institutional backdrop; however, it depends on the finalization of the business combination process.
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This article contains market analysis and price predictions. These are not guarantees. Crypto markets are volatile. Always DYOR. Not financial advice.
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