Source: PaxForex Premium Analytics Portal, Fundamental Insight
The global bear market continues to dominate price action, and cryptocurrencies are among the hardest-hit assets. With Bitcoin and Ethereum leading losses, Ripple and its XRP/USD token stand out as a potential breakout candidate. Most cryptocurrencies challenge fresh 2022 and current bear market lows, but despite fundamental headwinds, the XRP/USD maintains its cautious but volatile uptrend. At a time Bitcoin and Ethereum moved lower, Ripple advanced, but the ongoing SEC versus Ripple lawsuit hangs over price action and prevents a sustainable breakout until the case resolves.
The US Securities and Exchange Commission (SEC) and Ripple continue to battle it out in court, but for several months it appears Ripple gained the upper hand. A favorable outcome is possible but not guaranteed. Courts may await more pending government regulations before making their final ruling, but as time drags on, the chances for a favorable outcome for Ripple increase. It could trigger a massive rally in price action, especially in 2023 and beyond, which is one reason the XRP/USD token ranks among the top cryptocurrency projects below $1.00 to reach that level, especially since it traded above $1.00 in November 2021.
One unique advantage Ripple has is that is one of a few cryptocurrency projects compliant with ISO 20022, an ISO standard for electronic data interchange between financial institutions. Other known entities that are ISO 20022 compliant include SWIFT, Algorand, XLM, XEP, and IOTA. Unlike theoretical usages in the real world and promises to disrupt sectors, Ripple positioned itself at the center of the financial system and continues to onboard financial institutions as partners. Once the legal battle with the SEC ends, price action could reward patient investors.
The forecast for the XRP/USD is turning cautiously bullish after this cryptocurrency pair retreated from a multi-week peak into its Ichimoku Kinko Hyo Cloud. It acts as support and maintains a bullish bias with its ascending Senkou Span A, while the Senkou Span B has flatlined. Volatility could rise with ascending Kijun-sen suggesting short-term bullishness remains intact, but the Tenkan-sen is flat. A pending bullish crossover could add to upside pressures. Traders should also monitor the CCI following its breakout from extreme oversold territory. A retest with a higher low could push this indicator above the zero level, from where buyers may step in. Can bulls build on its recent long-term gains and pressure the XRP/USD token into its horizontal resistance area, with a breakout to highs last seen in May 2022? 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 0.4200 to 0.4640 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 0.4485
- Take Profit Zone: 0.5320 – 0.5545
- Stop Loss Level: 0.4000
Should price action for the XRP/USD breakdown below 0.4200, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 0.4000
- Take Profit Zone: 0.3330 – 0.3550
- Stop Loss Level: 0.4200
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