XRP Prints Gravestone Doji on Weekly Chart—Technical Analysis Sparks Debate

Source: CryptoNewsNet Original Title: XRP Prints Gravestone Doji on Weekly Chart—Expert Says Not a Great Look Original Link: XRP has printed a bearish candlestick pattern on the weekly time frame, which has historically preceded significant price corrections.

Notably, prominent market analyst Ali Martinez drew the crypto community’s attention to this development. At the time, XRP was close to forming a gravestone doji on the weekly chart following a strong price rejection.

Importantly, this bearish pattern has fully formed following a close at $2.072 last week. The timeframe of occurrence and the technical indication this candlestick suggests have sparked concern among XRP holders.

Gravestone Doji Puts XRP at Risk of Further Decline

XRP started last week on a bullish note, building on its 12% growth two weeks ago. The XRPL native token rallied nearly 13% in two days to a high of $2.41 before the momentum faded.

Consequently, the asset has retraced 14% over five days, relinquishing all its earlier gains, and closed last week with a slight 0.88% decline. With this downtrend, XRP formed a deadly candlestick pattern, known as the gravestone doji.

For the uninitiated, the gravestone doji is a candlestick that has an inverse “T” shape. Typically, it has a long wick, showing severe price rejection. Additionally, its opening, closing, and low price are closely clustered after a swing high, indicating that bears stepped in during the uptrend and quickly pushed the coin below its opening price.

Last week, XRP did exactly this, dropping from its $2.41 high to its opening price of $2.09, then closing at $2.073. According to Martinez, this does not look good for XRP, suggesting it might fall much further.

Remarkably, this aligns with several other analyses. One analyst noted that XRP could drop to $1.8 after failing to hold the support around $2.10 and $2.05.

A Credible Bearish Signal?

Notably, the gravestone doji typically signals a price ceiling and the start of a larger bearish trend. Its occurrence on the higher time frame also adds to the strength, and XRP seems to be following that trend already, with a 1.20% correction to $2.043.

However, some analysts argue that candlesticks and trendlines are not credible indicators of a price trend in isolation. Their reliability increases when used with other technical indicators, such as MACD and RSI.

Moreover, some analysts view the XRP retracement differently, noting that the downtrend was merely a retest before a broader bullish development. Their analysis suggests that XRP broke out of a descending channel last week, and the ongoing retracement was just to shake off weak hands and retest the structure before the next impulsive move.