Ripple price analysis (1–6 September): can bulls overpower bears?

As Ripple’s court case with the SEC continues, XRP may be set for a sharp rally

A ripple coin                                 
Ripple could be set for a sharp rally Photo: Shutterstock

The lawsuit between the US Securities and Exchange Commission and Ripple has escalated – with new legal filings showing that the SEC wants to review Ripple’s company meetings since 2014. 

The SEC’s attorney wrote to Judge Sarah Netburn, who is hearing the case, saying: “The recordings may reveal efforts Ripple took to increase or maintain XRP’s price or to create expectations of profits in potential XRP purchasers, both of which are relevant… to prove whether XRP was offered and sold as a security.”

On the other hand, Ripple has filed a motion “to compel the SEC to produce documents showing whether SEC employees were permitted to trade XRP and other digital assets”, its own attorney, James Filan, tweeted.

Ripple’s attorneys wrote  in a letter to Netburn: “Defendants are entitled to know whether the SEC permitted its own employees to sell, buy and hold XRP as market participants during the very period the SEC now claims that defendants violated the law and acted recklessly by selling XRP.” 

Can XRP’s price overcome the uncertainty of the court case and benefit from the improving sentiment across the crypto sector? Read the Ripple price analysis to find out.

Ripple technical analysis: weekly chart

Ripple weekly chart

XRP’s price has formed an inside-day candlestick pattern for the past two successive weeks. This suggests indecision among the bulls and the bears. The XRP/USD pair fell 6.64% last week to end at $1.14 on Saturday.

The rising moving averages and the relative strength index (RSI) in positive territory indicate advantage to buyers. If bulls can resolve the uncertainty to the upside and push the price above $1.34174, the pair may start its journey toward $1.75 and then challenge the psychological level of $2.

Conversely, if bears sink XRP’s price below $1.04, the next stop could be the 20-week exponential moving average (EMA). A strong bounce off this level will suggest that the sentiment remains positive and traders are buying on dips, while a break below the 20-week EMA will signal that bears have made a comeback.

Ripple technical analysis: daily chart

Ripple daily chart

The bulls are defending the support at $1.04 while bears are selling on rallies to the downtrend line. This has led to the formation of a descending triangle pattern, which will complete on a break and close below $1.04.

Such a move will suggest that the XRP/USD pair has topped out in the short term. The pair could then start its decline to the 50-day simple moving average (SMA) and then toward the pattern target of $0.74.

On the other hand, if bulls push XRP’s price above the resistance line of the triangle, it will invalidate the bearish set-up. The failure of a bearish pattern is a bullish sign, as it traps several aggressive bears, who are then forced to cover their positions. This results in a short squeeze, boosting prices higher.

The upsloping moving averages and the RSI in the positive zone suggest that the path of least resistance is to the upside. If bulls drive the price above the resistance line, the pair may rise to $1.34 and then to $1.70.

How to trade Ripple this week

Ripple price analysis shows a bearish descending triangle formation. If bulls push the price above the resistance line of the triangle, it will invalidate the negative setup. That could result in an upwards move to $1.34, and if this level is crossed the bullish momentum may pick up. This positive view will be invalidated if bears sink the price below $1.04.

 Whatever the outcome might be, your decision to trade depends on your attitude to risk, your expertise in this market, the spread of your investment portfolio and how comfortable you are about losing money. This analysis does not constitute investment advice. It’s important to make your own analysis before deciding to invest and you should never invest more than you can afford to lose.

Trade ripple to US dollar: XRP/USD chart

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