Source: PaxForex Premium Analytics Portal, Fundamental Insight
Encouraging news favoring a positive outcome in the legal battle between the SEC and Ripple resulted in a massive price spike in the XRP/USD on July 13th, more than doubling the price during the day. While the initial enthusiasm faded, and price action corrected by roughly a third, the outlook for Ripple remains bullish. The legal victory over the SEC that is likely to result in an SEC appeal partially removed the most significant obstacle to the upside of this token. The community should remain cautious, as Ripple has won a significant battle, but the war with the SEC is not over until the SEC exhausts all legal avenues to appeal the ruling.
Adding to encouraging developments for Ripple Bulls is strong institutional demand, with assets under management at $76 million. The amount is not mind-blowing, but it increased despite legal issues and news of the SEC appeal, suggesting optimism that the final outcome remains a victory over the SEC. The long-term technical outlook dating back to 2017 confirms a bullish trend, pointing towards XRP/USD breaching the psychological resistance level of $1.00, from where bulls could storm the gate and push price action higher.
News of the Ripple victory over the SEC resulted in cryptocurrency Gemini re-listing the XRP/USD token, with other exchanges likely to follow suit. During the re-listing, a glitch and a thin order book caused the price to surge to $50, giving XRP a multi-trillion-dollar market cap for a few minutes before prices corrected to reflect the spot market.
The forecast for the XRP/USD is cautiously bullish after this cryptocurrency pair retreated from its 2023 high. A flag formation formed, which is a bullish continuation pattern, suggesting more upside ahead. After the downward-shifting Tenkan-sen moved below the ascending Kijun-sen, volatility could increase this week until a clear winner in the battle between bulls and bears emerges. The Ichimoku Kinko Hyo Cloud began to narrow, with the Senkou Span B flat and the Senkou Span drifting lower. A breakout in price action above the Senkou Span B could halt the development. Traders should also monitor the CCI following its breakout from extreme oversold territory. This technical indicator has plenty of upside potential, and a move above zero could accelerate the pending advance. Can bulls regain control over the XRP/USD and push price action into its horizontal resistance area? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the XRP/USD remain inside the or breakout above the 0.5945 to 0.6510 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 0.6250
- Take Profit Zone: 0.7235 – 0.7570
- Stop Loss Level: 0.5610
Should price action for the XRP/USD breakdown below 0.5945, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 0.5610
- Take Profit Zone: 0.4825 – 0.5195
- Stop Loss Level: 0.5945
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