Ripple has formed lower highs and higher lows, creating a symmetrical triangle visible on its 1-hour time frame. This signals indecision among buyers and sellers, hence the consolidation as traders wait for more directional clues.
The 100 SMA is below the longer-term 200 SMA on this time frame so the path of least resistance is to the downside. In other words, a break lower might be more likely than an upside breakout. Note that the chart pattern spans 0.1400 to 0.2400 so the resulting move could be of the same size. The 100 SMA dynamic inflection point lines up with the triangle resistance, adding to its strength as a ceiling.
Stochastic has barely made it into the overbought zone but is already turning lower to reflect a pickup in selling pressure. Ditto for RSI which is also turning lower to indicate a pickup in selling pressure. With that, Ripple could find its way down to the 0.1100 level if it does break lower.
Volatility among digital currencies has been subdued in the past few days as the rallies lost steam and traders started to book profits. The selloff has also subsided, indicating that market watchers are staying on the lookout for bigger catalysts that could determine longer-term direction.
As for the dollar, demand has been revived after June rate hike expectations rose on slightly stronger than expected core PCE price index. Recall that policymakers had been waiting for more confirmation that the slowdown in Q1 was indeed transitory before making another tightening move. Earlier on, the GDP reading enjoyed an upward revision to show that growth wasn’t that bad during the first quarter.
Of course overall market sentiment could potentially play a bigger role in determining Ripple direction, along with industry developments. Geopolitical risks tend to support alternative assets like cryptocurrencies, and the ongoing troubles in Greece and Italy are keeping demand in place. Apart from that, the upcoming snap elections in the United Kingdom also leaves a bit of political uncertainty on the table so traders might seek returns from the likes of bitcoin and Ripple as well.