BCGAME - Free 5BTC Daily Bonus!The XRP price chart looks set to produce the first “death cross” in five months, a signal that analysts consider to be an indicator of a bear market.
The 50-day simple moving average (SMA) of the XRP price is expected to cross below the 200-day SMA in the next two days, confirming the so-called bearish death line. While in theory the pattern implies a deeper sell-off, historical data suggests otherwise.
Previous occurrences observed in early February of this year, March 2020, August 2019, April 2018, January 2017 and May 2016 have marked top or interim price funds. One in May 2014 brought immediate sales pressure to the market.
Death Cross's dismal record as a reliable indicator is hardly surprising given that moving average studies are based on retrospective data. In other words, deadly crosses are the result of a prolonged sale and have limited predictive powers. Most of the time, the market is oversold by the time the crossover takes place.
The previous bearish crosses (above left) were accompanied by an oversold, or below-30, reading of the Relative Strength Index (RSI).
This time, however, the RSI is biased to the downside. Therefore, the possibility of the cross of death inviting stronger sales based on the graphics cannot be ruled out.
Immediate support is at the June 22 low of $0,51 followed by $0,43, which is the 61,8% Fibonacci retracement of the December-April run high. The June 29 high of $0,73 is the level to beat for bulls.
