Ripple price analysis (27 September–3 October): Is the correction over?
Ripple could remain range-bound for a few days
The US Securities and Exchange Commission (SEC) scored a minor victory over Ripple in their ongoing court case when Judge Sarah Netburn in New York denied Ripple’s motion to gain access to crypto trading records of SEC employees.
Ripple was aiming to access the records to see if some SEC employees held XRP in their portfolios. That discovery would have shown that the commission did not have a clear framework to distinguish between a security and a cryptocurrency, undermining the SEC’s case.
On the operational front, Ripple announced on 22 September that it had entered into a partnership with Bhutan’s central bank, the Royal Monetary Authority, to “use Ripple’s CBDC solution to pilot a central bank digital currency (CBDC) in phases”.
Ripple’s XRP token recently received support from Rosie Rios, the former 43rd Treasurer of the United States, who said that XRP facilitates cross-border payments, unlike several other cryptos whose value is derived from speculation.
Ripple announced on 24 September that it had approved grants worth $2m (£1.46m) in total value to applicants, who will be working on several projects, including the development of non-fungible solutions for the XRP ledger.
Will the setback in the lawsuit pull down XRP’s price or could the developments on the fundamental front boost prices higher? What do the charts suggest? Read the Ripple price analysis to find out.
Ripple technical analysis: weekly chart
XRP’s price extended its correction last week and dipped below the 20-week exponential moving average (EMA). However, a minor positive is that bulls purchased the dip, as seen from the long tail on the candlestick.
The XRP/USD pair recovered from the intra-week low to end at $0.94285 with a decline of 9.94% over the previous week’s closing price.
The 20-week EMA has flattened out and the Relative Strength Index (RSI) is near the midpoint, suggesting a balance between supply and demand. This balance will shift in favour of bears if they sustain the price below $0.85.
Such a move could open the doors for a decline to the 50-week Simple Moving Average (SMA). On the upside, buyers will have to push and sustain XRP’s price above $1.05 to suggest that the correction may be over.
Ripple technical analysis: daily chart
XRP’s price has been trading between $0.85775 and $0.96781 for the past few days. The downsloping 20-day EMA and the RSI in the negative territory indicate advantage to bears.
If the XRP/USD pair plummets below $0.85, it will suggest that the current consolidation was a continuation pattern. The pair could then slide to $0.74 and later to $0.69. The longer the price sustains below the moving averages, the greater the possibility of the resumption of the down move.
The bears are likely to mount a stiff resistance in the zone between $0.96781 and the 50-day SMA. If the price turns down from this zone, the range-bound action may continue for a few more days.
A break and close above the overhead zone will be the first sign that bulls have made a comeback. The pair could then attempt to rise to $1.41.
How to trade Ripple this week
The Ripple price analysis shows that the price is currently stuck in a range between $0.85775 and $0.96781. A break below the range could signal the resumption of the down move with the next target at $0.74. On the other hand, a break above the range could push the price to the 50-day SMA. A break and close above this resistance will suggest that the sentiment has turned positive.
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. You should never invest more than you can afford to lose.