Crypto analyst CasiTrades issued a stark warning Thursday, declaring XRP's recent surge to $1.39 a deceptive 'temporary rally' that sets the stage for a sharp 10% correction. The analyst contends the market is being primed for a significant downward move that could catch unprepared traders off guard, suggesting the true price action is still ahead.

Clean Wave Structure Points To A Larger Move Brewing

The XRP price climbed as high as $1.39 on April 8 as a Pakistan-brokered ceasefire between the US and Iran led to a wave of short liquidations across the crypto market, and sentiment changed from extreme fear to cautious neutral optimism.

But crypto analyst CasiTrades, who has been tracking XRP’s wave structure, saw something different in the price action. The bounce, she says, was exactly what the chart needed to complete a corrective structure. Now, the real move is set to begin.

According to CasiTrades, the recent XRP price bounce in XRP was the completion of a corrective phase. The move into the 0.618 Fibonacci retracement level, which is visible on the chart around the $1.35 to $1.40 range, helped confirm what she identifies as a clean Wave 2 in an Elliott Wave structure.

This move completed the counter-trend move without breaking the broader bearish count. Despite the strength of the bounce, it failed to break above these Fibonacci levels, and XRP is now back to trading at $1.32. Therefore, the next projected move is a Wave 3 impulse that continues the correction.

What The Chart Is Saying

CasiTrades’ analysis lays out a five-wave impulsive decline playing out on the one-hour timeframe. According to her count, XRP had already completed Wave 1 down and Wave 2 up by the time the ceasefire bounce peaked. With Wave 2 now likely completed, attention turns to what typically follows in Elliott Wave theory: Wave 3, which is the strongest and fastest move in the sequence. 

The target for Wave 3’s conclusion is somewhere around $1.09, and this corresponds to a 0.618 Fibonacci retracement level. A fourth-wave bounce to $1.20 is expected next. After that, a fifth-wave continuation could follow, with the 0.786 extension at $1.0854 and the 0.854 extension at $0.862 serving as deeper structural targets if the move plays out fully.

The current macro environment offers few bullish factors that can negate the bearish outlook. The two bullish factors are the CLARITY Act markup, which is scheduled for the second half of April, and any progress on the Iran ceasefire. However, if the CLARITY Act stalls and the war drags on, XRP’s $1.30 support could break, and the price could fall lower.