XRP is on the verge of forming a ‘death cross’ pattern, a well-known bearish technical signal. This occurs when the 50-day moving average crosses below the 200-day moving average, typically indicating a major trend reversal and sparking increased selling pressure. Historically, this pattern has been followed by price declines, as traders strategies in response to the market outlook.

Moving Averages Converging

The provided chart highlights that XRP’s 50-day and 200-day exponential moving averages (EMA) are currently converging, signaling that the death cross might soon take shape. When this happens, it tends to reinforce other bearish indicators, raising the likelihood of a significant downward movement. 

_{XRP/USDT Chart Source: TradingView}

At present, XRP is trading around $0.55 and has been struggling to maintain its current level. The failure to build bullish momentum at this price point or stabilize further suggests that XRP may soon see a deeper decline. 

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Should the death cross form, traders can expect XRP to potentially drop to the $0.50 level or lower, depending on how market participants react.

Broader Market Conditions Adding Pressure

The anticipated death cross is likely to make traders and investors more cautious, which could lead to increased sell-offs, accelerating XRP’s decline. The broader market environment is also playing a role in this bearish sentiment. Global economic uncertainties, ongoing regulatory scrutiny, and heightened volatility in the overall cryptocurrency market are putting additional pressure on XRP. 

Related article: Is XRP at a Crossroads? Analyzing Its $0.55 Support Level

The inability of XRP to hold its current support level only adds to the bearish outlook. If it breaks below key levels, such as the $0.50 mark, a more significant price correction could occur. This could push XRP into a longer-term bearish phase, potentially signaling further declines in the future. 

XRP’s technical setup strongly suggests that the formation of a death cross is imminent, likely resulting in a sharp downturn in its market value.