All eyes are on XRP, the cryptocurrency issued by Ripple Labs, which had a weekly rise of 67% and after 3 years was once again trading above $1.
Now, the big question is knowing how far the digital currency can rise.
In principle, it is worth noting that, despite this rise, the price of XRP is 71% below the historical highs reached in 2018. At that time, the asset reached a price of $3.84 and became the second most valuable cryptocurrency on the market.
Although there is still a long way to go, for some analysts that gap could narrow in the short term if they look carefully. the price movements that XRP has recorded since Donald Trump’s victory in the United States elections.
Since November 6, the price of the currency issued by Ripple shot up to $1.25, but then returned to the $1.10 area.
Currently, XRP remains within the range of $1 to $1.20, suggesting that the price has found a zone of stability. This could be a sign that the market is preparing for a possible bullish move.
These periods are often seen as a consolidation of an investor base. Generally, They occur after a significant movement in price, either up or down. For that reason, the market needs time to stabilize.
During the consolidation period, investors seeking short-term gains tend to exit, while those with a long-term view take it as a signal to strengthen their positions.
Precisely, Santiment, a market analysis firm, warned that in recent days whales accumulated more than 453 million XRPthe equivalent of more than 526 million dollars.
For their part, retail investors divested of their holdings, with the aim of obtaining higher returns. Wallets with less than 1 million XRP sold more than 75 million tokens, valued at $87 million.
The market analyst known on X (formerly Twitter) as @LeviRietveld says: “This period of consolidation indicates that traders are taking a breather, probably to reassess and prepare for the next move in the market.”
At the same time, he explains that, for him, XRP market has a mixed outlook because RSI (Relative Strength Index) “suggests a greater likelihood of a correction rather than further price increases.”
At the top of the chart you can see that the RSI is in an overbought zone.
In the chart above, the analyst indicates the possible price movements of XRP with two black arrows: one up and one down. If the price pulls back, one of the key levels it could reach is $0.936. This value corresponds to the Fibonacci retracement level, a technical tool used to identify points where the price of an asset could find support during a fall.
As seen in the image, the Fibonacci retracement lines are represented by red horizontal stripes, highlighting these crucial levels.
However, the trader also clarifies that “if it maintains its momentum, XRP could retest the recent high of $1.25 in the coming days,” although it clarifies that “breaking that resistance in the short term could be a challenge for bullish, given the current technical configuration.”
As explained in Criptopedia, the educational section of CriptoNoticias, in trading the term resistance refers to a price level that an asset finds difficult to overcome due to market psychology factors. In this case, investors often consider that the digital currency, such as XRP, It has already reached a high price and for that reason they decide to get rid of it. These movements generate a bearish momentum that prevents the price from rising.
Factors that could drive the price of XRP
Trump’s victory in the United States elections generated bullish momentum in bitcoin (BTC) and the rest of the cryptocurrencies, including XRP. During his campaign, the Republican leader promised promote industry-friendly regulation to encourage its growth.
Likewise, he had assured that during his second presidential term, the Securities and Exchange Commission of that country (SEC) will no longer be headed by Gary Gensler, something that could be finalized in the coming days due to the possible resignation of the official.
During his administration, the head of the regulatory body had a persecutory attitude against cryptocurrencies, and Ripple Labs was no exception.
In fact, the XRP issuer today maintains a legal dispute with the SEC for trading that asset through exchanges. For the US Justice, the asset can only be considered an unregistered security (security) under certain circumstances, such as institutional sales. However, the resolution was not accepted by the regulatory body, which decided to appeal the decision.
With Gensler leaving the SEC, the case could be resolved favorably for Ripple Labs, potentially boosting the price of its cryptocurrency.
For their part, the asset management firms 21Shares, Canary Capital and Bitwise, requested approval to list an exchange-traded fund (ETF) based on XRP. Should it materialize, it would be great news for the digital currency community.
Finally, it is worth noting that Ripple Labs continues working on educational projects to promote the use of cryptocurrencies, in addition to going deeper with the development of its RLUSD stablecoin.
