XRP's Simple Cycle Pattern: Why the 50-Week SMA Matters

XRP is currently trading at $1.76, down 3.06% over the past 24 hours. This latest price movement has reignited discussions among technical analysts about a critical pattern that repeats across market cycles. Crypto analyst Steph Is Crypto recently highlighted how the 50-week simple moving average (SMA) acts as a crucial indicator in XRP’s simple cycle, revealing a framework that has predicted major price swings for over a decade.

Understanding XRP’s Simple Cycle Through Historical Patterns

The concept of XRP’s simple cycle is rooted in how the token behaves relative to the 50-week SMA. According to technical analysis, whenever XRP’s price drops below this moving average, the long-term trend shifts bearish, and the SMA transforms from a support level into a resistance barrier. This creates a predictable pattern that has repeated across multiple market phases.

Looking back at historical data reveals a striking consistency. In 2015, XRP experienced a sharp decline of approximately 75.03% from its local peak. The 2018 cycle showed an even steeper drop of 85.77% after the price broke below the SMA. Most recently, in 2022, the token fell 68.61% following the same pattern. These figures demonstrate how the simple cycle framework has remained remarkably consistent over nearly a decade of market data.

The 50-Week SMA: A Simple Cycle Tool for XRP Traders

The 50-week SMA functions as a central element in analyzing XRP’s simple cycle. When price retests this moving average after breaking below it, the retest typically fails, leading to extended declines. This sequence has proven reliable as a measure of market trends for XRP.

The mechanics are straightforward: the white line on a technical chart showing XRP’s price action reveals how each retest of the 50-week SMA has consistently failed, resulting in subsequent drops. This simple cycle behavior suggests that the SMA acts as a decisive factor in defining each phase of the market cycle. Once broken, reclaiming this level becomes increasingly difficult, setting up the conditions for the next downleg.

XRP at $1.76: Testing the Simple Cycle Theory

XRP’s current situation at $1.76 places the token at a critical juncture within its simple cycle. The price recently approached the 50-week SMA following the January rally but has failed to establish support above this level. This mirrors conditions observed in previous cycles—a classic signal in the simple cycle framework that precedes extended declines.

Recent price action supports this observation. XRP fell from above $2.00 to $1.84 within the past week, now trading at $1.76. If history repeats through the simple cycle pattern, the implications for XRP holders could be significant.

What Could Happen Next in XRP’s Simple Cycle?

Using the simple cycle framework and historical precedent as reference points, analysts project two potential target zones if the current pattern plays out. Past declines have ranged from 68% to 85% after the SMA retest failure—a range established consistently through the simple cycle model.

These percentages translate to specific price levels: a 68% decline from current levels would target approximately $0.59, a price not seen since late 2024. A more severe 85% drop would bring XRP to around $0.27, a level the token has not touched since early 2021. While the present situation doesn’t constitute a certainty, the historical data provides a framework for evaluating support and resistance levels through the lens of the simple cycle.

The simple cycle pattern remains the central analytical tool for understanding XRP’s potential next moves. If the token fails to recover and reclaim the 50-week SMA as support, the established pattern suggests traders should prepare for the possibility of significant downside within the next phase of the cycle.