XRP Price Turns Bullish, Forms Bull Flag, and $5 Call Options Gain Steam, Godbole Says.

XRP is showing signs of a potential breakout as its price pattern suggests a bullish move ahead, alongside increasing options activity around the $5 strike on Deribit.

Despite a 10% dip this week, XRP’s chart is forming a classic bull flag pattern, which typically signals a continuation of the previous bullish trend. This pattern, seen after a sharp price rally, often precedes a significant upward move. According to Charles Kirkpatrick, a recognized market technician, “flags preceded by a rise of 90% or more have almost zero failure rate and an average return of 69%,” suggesting that the odds favor a breakout in the same direction as the prior trend.

XRP has already seen an impressive 500% price surge to $2.9 in just four weeks leading up to December 3, and technical analysis suggests that a breakout could push the token toward the $5 mark. This potential price target is derived using the measured height method, where the magnitude of the previous rally is added to the breakout level, currently around $2.5.

In the options market, traders are increasingly positioning for a move above the $5 level. The $5 strike call options on Deribit are seeing heightened activity, with 1.7 million contracts traded in the last 24 hours, making it the second-most traded XRP option. Additionally, the $5 call option has the highest open interest among out-of-the-money options, totaling $1.25 million in notional value, signaling that traders expect a potential price surge.

That said, while technical patterns like the bull flag offer insight into potential price movements, they are not foolproof. As market sentiment can shift quickly, especially in the options market, it’s essential to stay vigilant and monitor broader market conditions before making any trading decisions.