Following a federal court ruling that deemed XRP sales compliant with U.S. securities laws, XRP (XRP) experienced a significant price surge. Despite a minor setback on July 14 with a 10% drop to $0.76, XRP maintained a notable 65% increase compared to the previous day’s lowest price.
Over the past 24 hours, the XRP/USD pair reached its highest level at $0.93, marking its strongest performance since December 2021, nearly breaching the $1 mark. This ongoing surge in XRP’s price has more significant factors beyond just short-term reaction to positive news regarding Ripple.
Indicators suggest the involvement of significant players driving this rally. The duration of XRP’s substantial price increase aligns with a 10-month high in trading volumes. Moreover, the number of XRP whale transactions involving wallets holding over $100,000 peaked in 2023, indicating support from wealthy investors. The accumulation of XRP by whales during this rally signals their intent to position themselves for further gains. Entities holding a balance of 100,000 to 10 million XRP tokens have also increased their supply, further reinforcing this notion.
However, while XRP may test the crucial $1 level in the coming days, its rally extending beyond that appears weak. The pullback on July 14 coincided with a resistance confluence formed by a long-term horizontal trendline and a descending trendline ceiling. Additionally, the weekly relative strength index (RSI) for XRP has entered the overbought territory, increasing the likelihood of a correction.
In the event of a pullback, the XRP price could decline towards its ascending trendline support near $0.45 by September, representing a 55% decrease from the current price level. Alternatively, an overbought RSI could result in the XRP price consolidating within the $0.75-$1 range.
If the XRP price successfully surpasses the $1 mark, its next target by September will likely be around $1.35, a resistance level observed from August to December 2021.
As XRP continues its upward trajectory, it will face challenges, including potential resistance levels and the possibility of a correction due to an overbought RSI. Investors and traders should closely monitor these factors and exercise caution when deciding in the volatile cryptocurrency market.