Ripple price analysis: a 25% rally may be in the making
Ripple could witness a relief rally in the near term
The uncertainty of Ripple’s ongoing lawsuit with the United States Securities and Exchange Commission (SEC) and the bearish sentiment in the crypto markets have kept the XRP token under pressure. Buyers are attempting to form a higher low near $0.40 as of 19 May 2022.
In the latest development in the SEC case, the SEC has filed a reply to support its claim that the speech by its former director of the division of corporation finance is protected by attorney-client privilege.
Commenting on the SEC’s reply, attorney Fred Rispoli opined that things were “falling apart rapidly for SEC now.”
Ripple’s investors will now have to wait for the court’s ruling, which could act as a trigger for the next move in the XRP token.
On the operations front, Ripple announced that it had partnered with FINCI, a Lithuanian online international money transfer provider, to facilitate cross-border money transfers to both retail and business-to-business (B2B) customers. The tie-up will “enable FINCI’s customers to make seamless payments between Europe and Mexico.”
Will XRP go up thanks to buying by long-term investors at lower levels or could the uncertainty of the court case with the SEC keep investors at bay? Read the XRP price analysis to find out what the charts suggest.
Ripple technical analysis: weekly chart
XRP’s price plunged below the critical support at $0.50 last week, which completed the bearish descending triangle pattern. The XRP/USD pair rebounded off $0.33 as seen from the long tail on last week’s candlestick, but the bulls are struggling to sustain the higher levels. This suggests that bears are selling on every minor rally.
Although the downsloping moving averages indicate advantage to bears, the relative strength index (RSI) is close to the oversold territory. This suggests a possible consolidation or a relief rally in the near term.
The critical level to watch on the upside is $0.51. If bulls push and sustain the price above this level, it will suggest that markets have rejected the lower levels. That could clear the path for a possible rally to the 20-week exponential moving average (EMA).
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Contrary to this assumption, if XRP’s price turns down and breaks below $0.33, the selling could intensify. The pair could then plunge to $0.16.
Ripple technical analysis: daily chart
XRP’s price broke below the triangle on 9 May and attempts by the bulls to push the price back above the breakdown level failed on 10 May. That attracted heavy selling and the XRP/USD pair fell to $0.33 on 12 May.
This decline pulled the RSI deep into oversold territory, which resulted in a relief rally on 13 May. However, the bears are not willing to let go of their advantage as they continue to sell at higher levels.
If bears sink the price below $0.40, the pair could drop to $0.37 and later to $0.33. A break below this level could resume the downtrend.
Conversely, if the price rebounds off the current level, the bulls will attempt to push the pair above the 20-day EMA. If they manage to do that, the short-term bullish momentum may pick up and the pair may rally to the 50-week simple moving average (SMA).
Ripple: buy or sell at current levels?
Ripple is in a downtrend and the decline could extend further if bears sink the price below $0.33. On the other hand, if the price rises from the current level, the bulls will attempt to push the pair above the breakdown level of $0.51. Ripple’s price analysis suggests that a break above this level could clear the path for a rally to the 50-day SMA.
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.