Ripple (XRP) Pauses After Chaos: Is Wave 5 Still Coming or Is a New Bull Trend Emerging?

The Wave 4 break signals a final leg down before a major bullish reversal for XRP.

Ripple (XRP) has suffered a 6% decline in the past day, and traders are now wondering if the worst is over or if another move back is in store.

Data suggests that this break fits the classic Elliott Wave Theory (EWT) pattern, where extreme moves are often followed by a Wave 4 consolidation, paving the way for a final impulse wave.

Market ready for a turnaround?

Historically, markets rarely turn sharply after a huge wave 3 move. Instead, analyst CasiTrades explained that they typically undergo one last exhausted decline, or Wave 5, before a steady trend reversal occurs. The current price action seems to support this scenario. XRP remains stuck near the Wave 4 resistance levels as it failed to move decisively above the key USD 2.82 barrier even during the market recovery.

The lack of a strong breakout suggests that the market may need another wave of correction to fully remove selling pressure before sentiment can turn bullish.

Data from the mutual exchange remains highly inconsistent, further complicating matters. Different trading pairs have reported very different lows, from prices below $1 to significantly higher levels. On Binance USD, the price of XRP temporarily fell to $0.77, a staggering 72% drop from recent highs, breaking the .786 Fibonacci retracement.

While a revision to that extreme seems unlikely, the analyst cautions that a retest of the .618 retracement near $1.46 – or the “golden pocket” around $1.35 is plausible in the next wave down. These levels coincide with multiple technical indicators, including Wave 5 extensions, macro retracements, and previous Wave 2 targets, making them critical zones for accumulation and the setup for a strong reversal.

The potential silver lining for XRP traders lies in the chaos itself. The recent collapse may have pushed the broader Elliott Wave count from a shallow Wave 4 to a deeper macro Wave 2, setting the stage for a ‘powerful’ impulsive move that could eventually push XRP to $6.50-$10.00.

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$2 test looms

Crypto analyst Ali Martinez had recently made a worrying observation saying that XRP “looks like it wants to reach $2.” Martinez pointed to XRP’s UTXO Realized Price Distribution (URPD) to identify the next crucial support if the asset experiences another downturn, marking $2.10 as a potential low.

On the upside, he noted that a reversal could find immediate support at $2.80, a level that, if held, could pave the way for the crypto asset to resume its upward momentum towards $3.