After months of selling and consolidations, the XRP price may finally be ready to break out of the sustained downtrend. This comes as crypto analyst XRPunkie has applied the Elliot Wave analysis to the altcoin to show when the next rally might occur. The Elliot Wave Theory has long been one of the most popular tools for crypto analysts when it comes to trying to time the rallies and corrections for a cryptocurrency, and there have been times when it has been fairly successful.
Wave 3 Signals A Repeat Of 2024
Back in 2024, the XRP price had broken out rather quickly after trending around $0.6 for the better part of the year. This was driven in part by developments such as an announcement that the lawsuit between Ripple and the Securities and Exchange Commission (SEC) was drawing to an end.
Additionally, there were also some bullish developments as the XRP price had finally found a bottom. The result of this was a 600% rally that saw the XRP price rise over the $3 level for the first time in five years. And even though some of the gains have been erased, it remains over 300% higher than its 2024 lows to sit above $2 at the time of writing.
Naturally, this explosive move has remained fresh in the minds of XRP investors, and the search for clues to the next 600% rally is on. XRPunkie, using the Elliot Wave analysis, has suggested that a similar rally is about to happen as the next wave is underway.
The third wave of the theory is a bullish one, and comes after the more bearish wave 2, which the analyst’s chart shows to have needed back in June. Thus, Wave 3 is already in motion and is expected to trigger the next 600% price rally.
Given that the price is still trending above $2.2, this would mean that a 600% rally would put it on a path to new all-time highs. The analyst even suggests that Wave 3 could see the price rally more than 600%, putting XRP as high as $12-$15 in the process.
Trading Volume Tells Another Story For XRP
While the analysis does point to a repeat of the November price surge for XRP, the trading volumes are still a long way from where they were. To put this in perspective, the XRP trading volume had spiked by over 250% back in November as the price had risen sharply, and this momentum served as a buffer for the price to keep rising, with volumes eventually peaking at over $78 billion on a daily basis.
Compared to now, when the XRP daily trading volume is still trending below $10 billion, according to Coinglass data, it shows inadequate support for the price to stage such a rally. For there to be a repeat of the 600% rally, the XRP trading volume would have to see a significant increase in buying.
Featured image from Dall.E, chart from TradingView.com
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