BofA warns Fed risks policy mistake with early rate cuts
U.Today - The "dance" between the third biggest cryptocurrency, XRP, and its major counterpart on the market, Bitcoin (BTC), continues, and if the chart tells a story, it is not in favor of the former.
To interpret this perturbation of XRP’s performance against BTC, the Bollinger Bands will help - a popular, widespread and battle-tested technical analysis tool developed by John Bollinger.
For those unfamiliar, the bands are represented by a 20-day moving average and deviations - one below the curve and one above.
All in all, the indicator is a sort of range that helps traders and analysts to estimate what momentum the asset under observation has. To make the outlook more established, it is common to use large time frames - the daily one, to be exact.
It is evident that XRP recently lost a middle band and dipped below it, which turns on the scenario in which the altcoin will most likely test the lower band. The latter right now is stretching at 0.00002582 BTC per XRP, which is 4.02% below the current price point.
Scenarios
There are two ways to interpret this situation. The frst is that XRP is likely to lag behind Bitcoin in further market movements. If prices go up, the leading cryptocurrency will outperform the altcoin. If the market is headed downward, XRP is likely to suffer more than BTC.Another scenario is that Bitcoin will show strength, while alternative digital assets, and XRP among them, will stay stalled and show little to no action.
There is actually a third option - if XRP suddenly soars back above the 20-day moving average, then all of these scenarios will become irrelevant as the market structure will shift.