The recent federal court ruling affirming that XRP sales on crypto exchanges comply with U.S. securities laws has caused a dramatic surge in the price of XRP (XRP). Despite a slight retreat of about 10% to $0.76 on July 14, the price of XRP remains up around 65% compared to its previous day’s lowest price. In fact, the XRP/USD pair reached its highest level in the past 24 hours, hitting $0.93, which is the best performance since December 2021 and just shy of the $1 mark.
The surge in XRP’s price is not merely a short-term reaction to the positive news for Ripple. It is supported by key indicators that suggest a more sustained upward trend. For instance, the duration of XRP’s significant price pump coincides with a 10-month high in trading volumes. Additionally, the number of XRP whale transactions, referring to wallets holding more than $100,000, has reached its highest level in 2023, indicating strong support from wealthy investors. This accumulation of XRP by influential players is an encouraging signal that the price surge may just be the beginning of a more substantial upward trajectory.
The Persistence of XRP Whales and Potential for Further Gains
Furthermore, the rise in XRP’s price aligns with an increase in the supply held by entities with a balance of 100,000 to 10 million tokens. This suggests that whales, instead of selling during the rally, have actually accumulated more XRP, indicating their desire to position themselves for further gains.
From a technical perspective, XRP has the potential to test the crucial $1 level in the coming days. However, the likelihood of the rally continuing beyond this point appears weak for now. The pullback on July 14 occurred near a resistance confluence formed by a multi-year horizontal trendline (purple) and a descending trendline ceiling (black). Additionally, XRP’s weekly relative strength index (RSI) has become overbought, increasing the chances of a correction.
If a pullback does occur, XRP’s price could drop towards its multi-year ascending trendline support around $0.45 by September, representing a decline of approximately 55% from the current price level. Other potential price targets include the token’s 50-week exponential moving average (50-week EMA) near $0.48 and the 200-week EMA near $0.50.
On the other hand, an overbought RSI could also result in XRP’s price consolidating sideways within the range of $0.75 to $1. If the XRP price decisively breaks above $1, its next price target by September is likely to be near $1.35, which is a resistance level observed during the August-December 2021 session.
The recent surge in XRP’s price following the federal court ruling indicates growing confidence in the token’s compliance with securities laws. Key indicators such as trading volumes, whale transactions, and supply accumulation by influential entities support the ongoing price pump. However, technical factors and the overbought RSI suggest the potential for a pullback in the short term. Nevertheless, if the rally continues, XRP has the potential to reach new price targets in the coming months.
It is important for investors to closely monitor the market conditions and consider the risks involved. While the positive indicators support an optimistic outlook, market dynamics can quickly change. As always, it is advisable to conduct thorough research and make informed decisions based on individual risk tolerance and investment goals.