XRPUSD High probability of deep downside, low prob of big pump
The fundamentals:
Lots has changed in the past week or so, most notable the securities lawsuit being allowed to go ahead. This places a sword of damocles over XRP for at least the next two years. Fundamentals would have been strong but now look increasingly weak, as Ripple refused to argue the merits (whether or not XRP is a security) and instead focused the courts' attention on technical details about the timing of the complaint. The court threw out Ripple's motion to dismiss and its arguments about timing. Now Ripple will have to defend the securities lawsuit on the merits in open court and this will take years. Very very bad for adoption, what fintech wants to take the risk on being an unlicensed securities broker?
The chart:
Looking at log scale in the orange we have the massive falling wedge which has made us all bullish until quite recently. All things being equal this falling wedge should have led to a massive breakout to the upside. But then corona happened and the lawsuit was let through, now markets are weak btc is weak and XRP's price action is looking very weak. Instead of correcting out of the wedge to the upside the price action seems likely to correct to the downside forming a large descending channel, drawn in purple. If this happens it will most likely correspond with a much lower value of BTC and the whole market essentially collapsing in half. From there interest in cryptos is likely to wane and we're in for 2-5 years of sideways action with more selling possibly as low as the second red arrow indicates.
Alternatively if new money enters suddenly, say from the sale of stocks, gold, or maybe due to bullish good news like a major bank adoption then maybe we still break out the top despite all the bearish activity. If this happens I expect at least $1, possibly $10, possibly even higher.
The big picture:
Crypto as a whole may be correcting out of a massive bubble that started in 2017, the true value of BTC may be as low as $200. If this is the case XRP will not be spared. Or, as can happen with bubbles, maybe we go up to new ATHs when everyone least expects it. It's a volatile market out there and anything can happen, but taken in the context of current world markets I am now very bearish.
Lots has changed in the past week or so, most notable the securities lawsuit being allowed to go ahead. This places a sword of damocles over XRP for at least the next two years. Fundamentals would have been strong but now look increasingly weak, as Ripple refused to argue the merits (whether or not XRP is a security) and instead focused the courts' attention on technical details about the timing of the complaint. The court threw out Ripple's motion to dismiss and its arguments about timing. Now Ripple will have to defend the securities lawsuit on the merits in open court and this will take years. Very very bad for adoption, what fintech wants to take the risk on being an unlicensed securities broker?
The chart:
Looking at log scale in the orange we have the massive falling wedge which has made us all bullish until quite recently. All things being equal this falling wedge should have led to a massive breakout to the upside. But then corona happened and the lawsuit was let through, now markets are weak btc is weak and XRP's price action is looking very weak. Instead of correcting out of the wedge to the upside the price action seems likely to correct to the downside forming a large descending channel, drawn in purple. If this happens it will most likely correspond with a much lower value of BTC and the whole market essentially collapsing in half. From there interest in cryptos is likely to wane and we're in for 2-5 years of sideways action with more selling possibly as low as the second red arrow indicates.
Alternatively if new money enters suddenly, say from the sale of stocks, gold, or maybe due to bullish good news like a major bank adoption then maybe we still break out the top despite all the bearish activity. If this happens I expect at least $1, possibly $10, possibly even higher.
The big picture:
Crypto as a whole may be correcting out of a massive bubble that started in 2017, the true value of BTC may be as low as $200. If this is the case XRP will not be spared. Or, as can happen with bubbles, maybe we go up to new ATHs when everyone least expects it. It's a volatile market out there and anything can happen, but taken in the context of current world markets I am now very bearish.