XRP surged nearly 60% last week, breaking through a key technical analysis indicator called Ichimoku cloud on the weekly chart and setting a bullish precedent for market leader Bitcoin (BTC). According to Fairlead Strategies founder and managing partner, We view [XRP’s] cloud breakout as a good example for Bitcoin. The Ichimoku Cloud, created by Japanese journalist Goichi Hosoda in the late 1960s, is composed of five lines based on the price’s moving averages and is used to identify support and resistance levels and gauge trend changes. Crossovers above or below the cloud are widely taken to represent bullish or bearish trend change.
XRP has established a foothold above the Ichimoku cloud, while Bitcoin remains locked in a narrow range below the cloud resistance. The token’s breakout follows a year-long consolidation or basing pattern and suggests more gains ahead. Stockton noted, The move is meaningful on the chart because it resolves a year-long basing process higher. Intermediate-term momentum is positive and there are (surprisingly) no signs of upside exhaustion, supporting upside follow-through, with next resistance near $0.92.
A similar bullish outlook awaits Bitcoin on the higher side of the Ichimoku cloud, with the next resistance level at $31,900. At press time, XRP changed hands at 83 cents, while Bitcoin traded near $30,000.