Is XRP Setting a Trap? Elliott Wave Says One More Dip Before the Real Move

The latest reduction bounce from XRP could not have ended the present pullback, as its Elliott Wave construction requires yet another dip.

Notably, the Elliott Wave theory on the 1-hour chart reveals that the newest bounce has not but fashioned the construction wanted to substantiate a lasting backside. This means there may be room for one more drop into the help zone earlier than XRP can start a restoration.

XRP’s August Rally

The present construction began with XRP’s restoration from $0.99 in early August 2026. The value rose from round $0.99 on Aug. 11 to $1.70 by Aug. 22. This transfer gave the token a 28.5% acquire for August, marking its strongest month-to-month efficiency for the month since 2021.

The hourly chart reveals a number of options of an impulsive Elliott Wave transfer. Particularly, worth climbed shortly and moved in a outlined course, which frequently signifies Wave 1 in a bigger bullish sequence. 

If this holds, XRP may have extra room to surge after finishing its present correction. XRP has additionally proven a sample of sudden rallies adopted by longer intervals of consolidation, and the present construction follows a comparable path.

After reaching $1.70, XRP began dropping via overlapping worth motion as an alternative of following a clear, impulsive decline. This sample means that the market is attempting to stabilize, not essentially getting into a contemporary main downtrend.

The chart locations the most important help zone between $1.10 and $1.38. Importantly, 4 vital Fibonacci retracement ranges sit inside this space at $1.38, $1.29, $1.21, and $1.10. At press time, XRP trades round $1.39, which places it close to the higher fringe of this demand zone.

Why Three Waves Is Not Sufficient

XRP has began bouncing from its latest low, and the transfer could initially appear like affirmation that the correction has ended. 

Nevertheless, the present upward thrust incorporates solely three waves. Elliott Wave idea usually requires a five-wave upward construction to substantiate that a correction has ended and that consumers have regained management.

For now, the transfer suits higher as a B wave inside a bigger A-B-C correction. Underneath this view, Wave A took XRP from the $1.70 excessive down into the help zone, whereas the present bounce represents Wave B. 

This leaves room for a potential Wave C decline earlier than a sustained restoration begins. Nevertheless, it is very important notice that Wave B may nonetheless climb increased earlier than sellers return. 

The chart locations resistance between $1.44 and $1.60, with Fibonacci ranges at $1.44, $1.49, $1.53, and $1.60. If sellers take management in that space, Wave C would change into stronger, with $1.21 and potentially $1.10 arising as draw back targets.

What Macro Catalysts May Affect the Image

In the meantime, the Elliott Wave construction is just one a part of the setup. Notably, different market and regulatory developments may additionally have an effect on XRP’s subsequent transfer. 

For one, US spot XRP ETFs recorded $18.96 million in contemporary inflows over the previous week, taking cumulative ETF inflows to $1.68 billion. The continued inflows present that institutional demand stays lively round present worth ranges.

XRP additionally trades above its 20-day, 50-day, 100-day, and 200-day exponential shifting averages. This has helped push the short-term pattern from bearish to bullish and confirms that the broader bullish construction stays intact, even when XRP experiences one other short-term decline.

For now, XRP’s $1.10 degree stays the key flooring for the bullish case. A transfer towards $1.21 or $1.10 would match the potential Wave C state of affairs. Till XRP kinds a full five-wave rise, the present bounce should be a short-term restoration.