XRP has formed a candlestick pattern that suggests a potential bullish reversal.

The asset has been in a nosedive state for the past several weeks, dropping by more than 20% since its peak in mid-July.

New Leg Up?

The technical term spinning bottom occurs when the underlying assets price goes through wide swings in both directions, but ultimately closes near its opening level. The long upper and lower wicks suggest that both bulls and bears were active, but neither side managed to gain the upper hand.

In situations where this setup forms after a steep decline and near a key support level, its regarded as a generally bullish sign as bears might be losing momentum. In XRPs case, this has been evident for the past month and a half as the asset plunged from its ATH of $3.65 in mid-July to a low of $2.7 market yesterday.

As with all technical indicators, the spinning bottom does not guarantee a reversal, but its often seen as an early sign of a shift. Analysts typically await a green candle close above the patterns high for confirmation.

Source: Trading View

Further Bullish Indicators

XRPs price actions are always a hot topic among the cryptocurrency community due to the sheer size of Ripples community. Consequently, the underlying asset is often the subject of price predictions, which can sometimes be quite outrageous. Among the more modest, though, are forecasts of XRP skyrocketing to $6 as the asset continues to consolidate above a key bullish setup.

Another analyst laid out the necessary steps the token has to go through in order to recover from its current downfall and surge to a new all-time high of over $3.65. The first phase has been defended, for now, and the next target is breaking past the $2.9 resistance.

Ali Martinez further mentioned the popular TD Sequential indicator, which has flashed back-to-back buy signals for XRP. Consequently, the analyst with over 150,000 followers on X determined that a rebound setup [is] in play.

TD Sequential flashes back-to-back buy signals on $XRP. Rebound setup in play! pic.twitter.com/nN8q4TD27c