Source: PaxForex Premium Analytics Portal, Fundamental Insight
Ripple price action will depend on the evolving legal battle between Ripple and the SEC. Investors and traders with a longer-term perspective should not ignore the positive developments outside of court. Ripple appears to gain the upper hand in the proceedings, but volatility will remain, and traders should remain patient.
Price action has enjoyed ongoing support from the Ichimoku Kinko Hyo Cloud, and given the build-up bullish sentiment, a breakout can trigger a short squeeze and force the XRP/USD higher. Retail investors have successfully forced bears to capitulate in several equity trades, also known as meme stocks, with the latest example last week with Avis Budget Group. The short squeeze triggered circuit breakers and halted trading, taking the price from around $170 to $525 before retreating. The XRP/USD has all characteristics for a similarly violent advance. Some consider it a bet against the US government and their interference in the cryptocurrency sector, adding to upside pressure.
Adding to the bullish developments is the push by Ripple’s plans in the lucrative NFT market, challenging Ethereum’s dominance. Comments by Ripple Chief Technology Officer David Schwartz concerning a late entry to the sector and its advantage of scalability, speed, and low costs added to expectations that Ripple would attempt to enter the NFT sector. It will provide a tremendous bullish catalyst for price action.
The forecast for the XRP/USD remains bullish as the Ripple Foundation golds its ground against the SEC lawsuit and enjoys long-term positive fundamental developments. Traders should expect a rise in volatility as the Ichimoku Kinko Hyo Cloud shows signs of a pause within its overall uptrend. The Kijun-sen and the Tenkan-sen continue their advance, but the CCI has moved into extreme overbought territory. Price action could face a few choppy sideways sessions before pushing higher. Can bulls extend the run in the XRP/USD and pressure this cryptocurrency into its next 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 1.2335 to 1.3110 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.2800
- Take Profit Zone: 1.6160 – 1.6900
- Stop Loss Level: 1.1550
Should price action for the XRP/USD breakdown below 1.2335, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1.1550
- Take Profit Zone: 1.0000 – 1.0450
- Stop Loss Level: 1.2335
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