By Chris Hollingworth 
XRP Price Analysis: Bullish V-Shaped Recovery Pattern Emerges
XRP (XRP) price is showing positive signs as a bullish technical pattern emerges on its weekly chart, coinciding with a significant increase in open interest, signaling bullish sentiment in the market.
Open Interest Surge Supports XRP Upside
Despite a 2% decline in XRP price over the last 24 hours, trading above $2.40 on May 16, the cryptocurrency has seen a 13% gain over the past two weeks as the broader market recovered. The open interest for XRP surged by 53% from $3.61 billion to $5.53 billion between May 8 and May 14 before slightly dropping to $5.06 billion on May 16. The rise in futures open interest alongside the price suggests a positive market sentiment.
Historically, significant increases in open interest have often preceded major rallies in XRP price. For instance, the current scenario reflects a similar pattern to the XRP price surge leading up to US President Donald Trump’s inauguration in January, resulting in a 70% rally from a low of $1.99 on December 31, 2024, to a seven-year high of $3.40 on January 16.
XRP Price Chart Analysis
The price action of XRP has been forming a V-shaped recovery pattern on the weekly candle chart since mid-January. A V-shaped recovery is a bullish pattern that occurs when an asset experiences a sharp price increase following a steep decline. The completion of this pattern is marked by the price reaching the resistance at the top of the V formation, also known as the neckline.
XRP is currently on a trajectory that resembles a V-shaped recovery, with bulls aiming to turn $2.60 into a support level to enhance the likelihood of a price increase to $3.00. Beyond that, the next target would be the neckline at $3.40 to complete the V-shaped pattern, representing a potential 40% increase from the current price level.
Technical Indicators and Analyst Predictions
The relative strength index (RSI) for XRP has risen from 43 to 56 over the past six weeks, indicating an increasing bullish momentum. Analysts have also made optimistic predictions for XRP’s future price movements.
Egrag Crypto, a crypto analyst, has forecasted that a breakout from a descending triangle in the daily timeframe could propel XRP price towards the $3.40 zone. Market analyst Dom highlighted the importance of XRP maintaining the $2.40 support level, which is above all volume-weighted average prices (VWAPs) and major moving averages, to sustain a bullish trend.
In conclusion, the emergence of a bullish V-shaped recovery pattern, coupled with the surge in open interest and positive technical indicators, suggests a potentially favorable outlook for XRP price in the near term. However, it is essential for investors to conduct their own research and exercise caution when making investment decisions in the volatile cryptocurrency market.
