XRP: Sell the Rip into 2.42–2.50 — Targeting 2.20 as Post‑Crash Distribution Resumes

Executive summary

• Regime shift confirmed: After months of distribution between ~2.75–3.15, XRP broke down violently on Oct 10 with a capitulation low near 1.53 and a heavy-volume close at 2.36. Today’s bounce into 2.48 failed, and price has slid back to ~2.35. The multi-timeframe picture is now decisively bearish with rallies meeting supply.
• Next 24h base case: Sell-the-rip environment. Expect a choppy drift lower with bounces capped in 2.42–2.50 supply, targeting 2.28 first and then 2.20. Alternate path is a squeeze toward 2.50–2.52 that should still find sellers.
• Trade plan (short): Optimal entry on a rebound into 2.42 (±0.02), take-profit near 2.20. Preferred protective stop (for risk control) above 2.52.

Market context and structure

• Higher-timeframe (Daily):
  • July 17–18 spike peaked ~3.65, followed by a multi-week distribution (3.55 → 3.00 → 2.75–3.15 range through Sept). Lower highs from mid-Sept (3.13 → 3.09 → 3.05) foreshadowed weakness.
  • Breakdown day Oct 10: Open ~2.80, extreme low ~1.53, close ~2.36 on the largest volume in months (15.6B). This was a volatility-and-liquidity shock that cleared downside liquidity and broke the range decisively.
  • Today (Oct 11) intraday sees heavy volume again (already >18B), with a failed recovery into ~2.50 and selloff back to 2.35. This reads as distribution around 2.45–2.50.
• Intraday (hourly) structure last 24–36h:
  • Post-crash rebound into 2.48–2.50 created a clear supply shelf. Multiple upper wicks and a series of lower highs (2.50 → 2.48 → 2.46) show seller control.
  • Break below 2.41–2.40 neckline after the lower-high sequence suggests a measured move toward 2.30–2.28 (first wave already printed 2.36). Continuation targets sit at 2.22–2.20.

Key levels (confluence)

• Immediate resistance/supply: 2.42–2.50 (hourly supply; 1H Kijun/VWAP cluster; 61.8% retrace of crash leg near 2.49–2.50).
• Pivot/neckline: 2.40–2.41 (lost; acts as resistance on retests).
• Near-term supports: 2.33–2.32 (intraday shelf); 2.28 (measured move/volume node); 2.22–2.20 (composite support and fib cluster); 2.13 (38.2% retrace of 1.53→3.09 leg); tail risk 1.95–1.70 if momentum accelerates.

Technical toolkit and read-throughs

1. Trend and moving averages

• Daily 20/50/200 MAs (approximated from price path) are all above spot and rolling over. Price is far below the 20D EMA (~2.9±), confirming downside momentum with room for mean reversion bounces that are likely to be sold.
• On 1H/4H, price trades below the 20/50 EMAs; prior reversion pushes into those MAs were rejected near 2.45–2.50. Bearish alignment favors shorting rallies.

2. Bollinger Bands (20,2)

• Daily: Bands have expanded sharply; price is riding the lower band (a “band walk”), typical of trend days after a break. Mid-band sits well above spot, and the first reversion attempt stalled under the lower band/midband crossover zone on intraday timeframes.
• 1H: After the crash, the BB midline around ~2.44–2.46 capped price repeatedly; lower band tests are recurring. This supports sell-the-rip bias.

3. RSI/Stochastics

• Daily RSI is likely in the low-30s or high-20s after the crash. In bear phases, RSI tends to stick in a 20–50 “bear range.” The bounce to ~2.50 likely nudged RSI toward ~35–40, but failure to reclaim 50 keeps momentum bearish.
• 1H RSI shows lower highs while price attempted equal-to-lower highs (bearish momentum alignment). No strong bullish divergence yet at the current pivot.

4. MACD

• Daily MACD is negative and below signal with a deep histogram. Early deceleration is possible post-capitulation, but no bullish cross is present yet.
• 1H MACD tried a weak bull cross during the rebound, then rolled over as price lost 2.41—consistent with renewed downside momentum.

5. Ichimoku (focus 1H/4H)

• Price is below the Kumo with Span A/B well above. Tenkan below Kijun, both sloping down.
• Rejections near the Kijun (~2.45) after attempts to mean-revert are classic “Kijun bounces” in bearish trends. Until price reclaims and holds above Kijun/Cloud, rallies remain sellable.

6. Volume, VWAP, and profile

• Oct 10 capitulation volume (15.6B) and today’s heavy volume (>18B) show intense participation, but the failure to hold above 2.48–2.50 implies distribution rather than accumulation.
• Session VWAP (today) is estimated around 2.41–2.44 early and drifting down; price below VWAP = seller control. Anchored VWAP from the crash low (~1.53) projects to roughly 2.40–2.43; price trading below it reinforces that rallies into this zone meet supply.
• Volume profile shows a budding node around 2.40–2.48; below that, a lighter pocket toward 2.30–2.28 that price can traverse quickly. Next heavier interest appears near 2.20–2.22.

7. Fibonacci mapping

• Swing reference: Oct 3 high ~3.093 to Oct 10 low ~1.528 gives a range of ~1.565.
  • 38.2% retracement: ~2.126
  • 50% retracement: ~2.311
  • 61.8% retracement: ~2.495
• Price tagged the 61.8% zone (2.49–2.50) and failed; it is now roaming near the 50% region (2.31). A decisive slip below the 50% generally opens a drive toward 38.2% (~2.13). Interim magnet at 2.22–2.20 is consistent with intraday measured moves.
• Intraday swing: 2.501 → 2.404 (~0.097) then a bounce to ~2.483. A 1:1 extension projects ~2.386 (hit) and a 1.618 extension ~2.328 (nearly tapped). Breaking 2.328 favors 2.28 then 2.22.

8. Chart patterns

• Intraday bear flag: The 2.36→2.48 channel broke lower; measured move of ~0.12 targets ~2.24–2.22.
• Minor head-and-shoulders on 1H: Left shoulder ~2.44, head ~2.50, right shoulder ~2.46, neckline ~2.40. Neckline break implies ~0.10–0.12 downside; achieved partially, with room to complete toward 2.30–2.28 and extend.

9. ATR and volatility regime

• Daily ATR ballooned on Oct 10. 24h realized volatility now elevated; a 5–10% move over the next day is feasible without new catalysts. This accommodates a path into the low 2.20s.

10. Elliott wave framing (heuristic)

• Crash day is wave A down. The rebound into 61.8% (~2.50) can be labeled corrective wave B. Current roll-over likely initiates wave C, commonly targeting the 0.382–0.500 retrace zone of the entire A→B range, which overlaps 2.24–2.13.

Synthesis and 24h path probabilities

• Base case (≈60%): Rallies stall between 2.42–2.50 and price grinds down toward 2.28, then 2.22–2.20 into Sunday/Monday Asia. Heavy supply above, VWAP overhead, and bear momentum favor this.
• Alternate (≈30%): One more squeeze into 2.50–2.52 (stop runs above today’s highs) before failure. Would improve short RR; still bearish unless sustained reclaim above ~2.52–2.55.
• Low-prob tail (≈10%): Disorderly downside extension if 2.20 breaks quickly, probing 2.13 or even 1.95–1.70 liquidity if weekend liquidity thins materially. Not baseline but within expanded-vol regime.

Trading plan

• Bias: Sell (short) rallies into 2.42–2.50 supply. This aligns with 1H Kijun/VWAP, 61.8% crash retrace rejection, and the neckline retest zone.
• Optimal entry: 2.42 (limit or scale 2.40–2.45). This optimizes RR given current 2.35 spot.
• Take-profit: 2.20 (first major target with multiple confluences: measured move, fib cluster, emerging volume node). Conservative partials at 2.28 are reasonable.
• Risk management (not part of output fields but strongly recommended): Protective stop above 2.52–2.55 (above 61.8% rejection zone and today’s highs) to invalidate near-term bearish thesis.

What would change my mind?

• A strong reclaim and hold above 2.52–2.55 (hourly close basis), flipping VWAP and Kijun to support and converting 2.50 from supply to demand. That would open 2.62–2.70 and challenge the short thesis.

Conclusion

• The weight of evidence (trend, structure, VWAP/volume, fibs, and failed 61.8% retrace) points to a sell-the-rip setup. Expect a drift lower over the next 24h toward 2.28 then 2.20. I prefer initiating shorts on a bounce to ~2.42 for optimal risk-reward.