XRP has failed to be a champion during the bounce off the May 19 and May 23 lows, generating only a 50% price gain from the low. Over the last four days, the XRP price action has been more reflective of a topping process, putting Ripple's price at risk of a pullback in the coming days.

XRP price closed on May 23 with a bullish hammer candlestick pattern level that was effectively triggered on May 24 when Ripple XRP traded above $0.816. The candlestick formed in the ‘legal uncertainty price range’ associated with November 2020 high and the December 2020 low, a time in which the SEC case was announced.

Over the last four trading days, Ripple XRP has wrestled with the psychologically important $1.00 and the 50 four-hour SMA. The XRP price action during this time has been passive with waning volume and no demonstrable interest in upside progress, suggesting a mild pullback may be necessary to effectively reset Ripple XRP for a meaningful charge beyond the tactically important price levels.

Ripple XRP is projected to define a head-and-shoulders topping pattern level on the four-hour chart, generating the needed pullback to reset Ripple XRP for the second leg of the bounce. The measured move target is at $0.807 based on the current position of the neckline. It would push XRP near the upper level of the ‘legal uncertainty price range.’ 

A possibility exists that XRP price will test the upper level of the range at a price of $0.780 and may even decline to the February 21 high at a price of $0.757, representing a 20% drop from the neckline. Any further weakness raises the odds that Ripple XRP will break under the May 23 low at $0.652, leaving the cross-border remittances token vulnerable to a test of the 78.6% Fibonacci retracement level of the price rally from the December 29 low at $0.555.

To reverse the short-term bearish narrative, the XRP price needs to rally beyond the head of the head-and-shoulders pattern level at $1.07. It would free Ripple to test the 38.2% retracement support level of the April-May decline at $1.15. Further upside will be complicated by the May 10-13 lows around $1.20-$1.23.

To be sure, as long as the SEC case continues, XRP will be predominately influenced by the sentiment of the broader cryptocurrency market and the XRP price action of the bellwether cryptocurrencies, Bitcoin BTC and Ethereum ETH.

Uniswap v3 looks set on both Arbitrum and optimism

Shiba Inu price contraction leads to price expansion