XRP failed to break above the upper boundary of its short-term descending channel and now trades near $1.25. The reaction in that zone could decide whether the August recovery holds or gives way to a deeper retracement.
XRP is trading around $1.25 after the token failed to break above its descending channel. The token has slipped into a key Fibonacci retracement area, and the next few sessions could show whether the August recovery stays intact.
Daily close has yet to confirm a defense of $1.25
On the daily chart, XRP continues to retrace the rally from the $0.99 August low to the $1.70 high, which stalled just below the $1.7-$1.8 supply zone. The asset has since printed lower highs and lost the 0.5 retracement at $1.34 earlier this month.
Yesterday's candle dipped to approximately $1.20, tagging the 0.702 level, before buyers pushed the price back toward $1.25. The long lower wick suggests demand is responding, but the daily close has yet to confirm a successful defense of the support zone.
If $1.25 holds, XRP would first need to reclaim the $1.34 level and the $1.40 supply zone, where the latest rebound was rejected. However, a decisive daily close below $1.20 would expose the $1.10-$1.14 demand zone, which overlaps with the 0.786 retracement.
Four-hour chart favors sellers
The 4-hour timeframe shows XRP trading within a descending channel since its late-September peak near $1.65. The latest rally attempt was rejected at the upper boundary around $1.33, extending the sequence of lower highs and lower lows through October.
That rejection pushed the price through the $1.25 demand zone, with a wick to roughly $1.20 before a modest recovery. As a result, buyers are trying to reclaim the zone rather than defend it from above, and failure to do so would raise the risk that sellers turn it into resistance.
A recovery above $1.28 could open the way toward the upper channel boundary near $1.3 and the $1.4 supply zone. On the other hand, weakness below $1.20 would likely bring the channel's lower boundary near $1.17 into play.
The short-term pattern still favors sellers, and the $1.20 low remains the key line buyers need to protect.
Source: CryptoPotato
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