Key takeaways:
XRP (XRP) price printed a bull flag pattern on the daily chart, a technical pattern associated with strong bullish momentum following an upward breakout. Is this the start of XRP’s rally to $5?
XRP price bull flag targets $5
The daily chart shows XRP trading within a bull flag, with the price facing resistance from the pattern’s upper trendline at $3.
A bull flag is a bullish continuation pattern in technical analysis, forming a small falling rectangle after a sharp price rise, signaling consolidation. It typically resolves with an upward breakout, continuing the initial bullish trend.
Related: Is XRP going to crash in September?
A daily candlestick close above $3 will confirm a bullish breakout for XRP, clearing the path for a rise toward the pattern’s target at $5. Such a move would represent a 77% increase from the current price.
However, before reaching this target, bulls will have to overcome resistance from the 50-day simple moving average (SMA) at $3.08, which has suppressed the price since Aug. 24. Other obstacles sit at $3.40 and the multi-year high of $3.66 reached on July 18.
On the downside, the area to watch is between the 100-day SMA at $2.68 and the 200-day SMA at $2.48, which remain key support zones for XRP price. Bulls must hold the price above this level to avoid invalidating the bull flag setup.
“$XRP could be gearing up for its next big breakout toward $5,” said analyst Crypto Pulse after spotting the pattern last week.
According to the analyst, the price was required to hold above the Aug. 3 low of $2.75 to keep the bullish structure intact.
“Lose $2.75 and see possible retest of the $2.5–$2.6 confluence zone before another push higher, ” Crypto Pulse said, adding:
“Overall, XRP still looks bullish; the breakout confirmation is what I’m watching next.”
As Cointelegraph reported, buyers are required to defend the crucial support around $2.73 to avoid a deeper correction toward $2.
Spot XRP ETF approval draws closer
The US Securities and Exchange Commission is set to decide on spot XRP exchange-traded fund (ETF) applications in a couple of months, with key deadlines for most of the applications falling between Oct. 18 and Oct. 25. The deadline for the decision on the Franklin Templeton XRP ETF is Nov. 14.
Approximately 11 proposals are under review, following Ripple’s 2024 legal victory clarifying XRP’s non-security status.
Market participants are optimistic, with betting odds for an XRP ETF approval by Dec. 31 now standing at 87% on Polymarket. Over the past month, the probability of approval has risen 23% in favor from around 64% on Aug. 6.
Nate Geraci, head of the ETF Store, emphasizes that the approval possibilities are almost certain as the decision deadlines draw closer.
“Personally, I think the odds are closer to 100%,” he said in an X post on Tuesday in response to the increasing odds.
Bloomberg senior ETF analyst Eric Balchunas estimates a 95% approval probability, citing regulatory clarity and the change in leadership at the SEC.
Approval could potentially unlock institutional capital, amplifying demand for XRP tokens, potentially driving prices toward $10-$20, with some analysts predicting $50 if major players like BlackRock join.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.