XRP Tags 1.70, Then Slips Back — A Long Upper Wick Left Behind

You only need to look at one candle: 8/22.

High 1.70, close 1.46. It closed 14% below the high, and the upper wick is more than twice as long as the body.

Volume that day was 4.5x the 20-day average. That's the biggest volume of this whole rally, and that volume was met with heavy selling near the top. More people were dumping near 1.70 than were buying.

Three days with no direction since

XRP bounced +4% on 8/23, then gave back -2.3% yesterday. It's only been chopping inside 1.378–1.551, and volume has dropped from 4.5x to 2.0x, with today even lighter.

For the record, three days ago I wrote that clearing 1.3441 would trigger short liquidations above and help fuel the move, and that played out. Price never came near the 1.2248 invalidation level either. What I didn't expect back then was a wick this long.

Rejected once at 1.55

There's the May weekly high at 1.55 and the March weekly high at 1.61. The 8/23 high was 1.5507, so it got stopped right at that level.

Above that is the 8/22 high at 1.70. Only a close above it would erase that day's upper wick.

1.42 is the line in the sand

Long liquidations are clustered at 1.42–1.45, 3–5% below the current price. They built up over three days of trading in this range, and the levels are calibrated against actual liquidation prints, so the location is fairly reliable.

Below that is the 8/22 low at 1.378.

A close below 1.42 and I'll treat the 8/22 wick as the real top. Intraday pokes don't count.

Almost no supply overhead

Only 5.6% of traded volume sits above the current price. Meanwhile, 55% of 80-day volume is concentrated at 1.08–1.16, more than 25% below here. The MA200 is way down at 1.28 as well.

It was light on the way up, and that lightness works exactly the same way on the way down.

RSI is still 81

RSI is 81.8 with ADX at 42. An ADX of 42 means a very strong trend. But Bollinger Band width has blown out fivefold, from 13% 40 days ago to 66%. When bands get this wide, a contraction phase usually follows at some point.

So for now

The direction is still up, but the 8/22 wick is a warning. A close above 1.55 opens 1.61 and then 1.70 again. Lose 1.42 and it's 1.378, and if that goes too, there's not much support for a long way down.

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