Ripple - Do not be without worries

On 8th August 2022, we introduced a setup with two alternative trades coming after the breakout from the wide range in which XRPUSD oscillated for some time. A few days later, a piece of news concerning a minor win for Ripple Labs Inc. against the SEC sparked a buying frenzy that propelled the price more than 40%. Meanwhile, in the early stage of the rally, we noted that this price action merely represented “buy the rumor, sell the fact.”

Then, during the rally, we continued to warn investors about the unsustainability of the move as we hinted at decreasing volume in spite of the rising price. Indeed, we raised this issue again after another bullish breakout from the symmetrical triangle took place. Soon after that, our worries came to fruition, and XRP began its decline.

At the moment, XRPUSD trades almost 20% lower from its recent high on 23rd September 2022, further confirming our bearish thesis. In fact, we stick to our price targets of 0.30 USD and 0.28 USD and believe they will be reached by the end of 2022. Our views are supported by persisting bearish macroeconomic factors and technical indicators pointing to more downside for this cryptocurrency.

Illustration 1.01

Illustration 1.01 shows the daily chart of XRPUSD. The price is down almost 20% from its recent peak of 0.558 USD, and volume continues to reflect the declining interest in XRP among new investors.

Technical analysis - daily time frame
RSI is bearish. The same applies to Stochastic and MACD. DM+ and DM- are bullish. Overall, the daily time frame is turning bearish.

Illustration 1.02

Illustration 1.02 displays the monthly chart of XRPUSD, showing it deep in the bear market territory.

Technical analysis - weekly time frame
RSI, MACD, and Stochastic show signs of exhaustion. DM+ and DM- stay bullish. Overall, the weekly time frame is turning bearish.

Illustration 1.03

Illustration 1.03 shows the mentioned setup from 8th August 2022. That same day, we set a medium-term price target for XRPUSD at 0.30 USD and a long-term price target of 0.28 USD, abstaining from setting a price target for the short-term (due to the price being in the neutral trend).

Please feel free to express your ideas and thoughts in the comment section.

DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.

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The chart shows a sharp decline before the CPI print, and then a fast bounce up, simultaneously with the stock market. The high correlation between cryptocurrencies and the stock market represents a hurdle for the primary trend to reverse (from bearish to bullish). As we expect macroeconomic conditions to worsen, we expect the reality to sink back in. Therefore, we stick to our medium and long-term price targets. Indeed, we are soon to update the medium-term price target to short-term. However, we want to see more signs of exhaustion and a potential second attempt of the XRP to take out the 2022 high.

Comment:

If the stock market starts declining, XRPUSD will likely follow.

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To confirm our bearish thesis, we would like to see a pick-up in volume and a retest of recent lows.

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The price action in XRPUSD remains muted in comparison with the rest of the market. In our opinion, that reinforces what we have been saying about a low interest in this cryptocurrency.

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XRPUSD commenced a successful retest of 13th October 2022 lows, confirming our bearish thesis.

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XRPUSD is positioning itself for the retest of lows from 20th October 2022. The chart below shows another variant of support and resistance levels.

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XRPUSD failed to deliver the retest of lows from 20th October 2022 (at least for now), and instead, it bounced back toward 0.47 USD, enjoying a relief with the rest of the cryptocurrencies (propelled by the stock market). Despite that, we do not think there is too much to worry about in medium and long term (in regard to our price targets at 0.30 USD and 0.28 USD). In our opinion, the time is running out quickly for the rally to continue further. Indeed, we think it will be put to the test next week with the FED rate hike.

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In our latest idea on XRPUSD, we finally updated our price targets to short-term and medium-term. We want to remind investors that cryptocurrencies followed the stock market upwards with some lag; the same is likely to occur now, with the market dropping after the FED.

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Today, news hit the market that Blockchain Association filed "amicus curiae" in the Ripple vs. SEC case. However, the character of petition relates to the status of cryptocurrencies, and not misdoing of people accused in the case.

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"Every month, on the first day, Ripple releases a staggering billion XRP from escrow to support the coin’s liquidity on exchanges. However, after that 700 or 800 million tokens gets locked back in escrow to be released another time in the future.

The other 188 million XRP was transferred by whales between major crypto exchanges. Those include Bitstamp, Bittrex, BitGo and CoinsPh.

Bitstamp participated in every transaction apart from the one initiated by Ripple Labs.

XRP remains one of the most popular digital currencies, therefore over the past two months whales have been quite active in moving this asset to exchanges to sell on highs. Image via TwitterXRP jumps 12 percent briefly." - by TradingView

Link to the article: www.tradingview.com/...u_today:cee0e4a8d:0/

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Today's pick-up in volume accompanying the price drop flashes a warning sign.

Trade closed: target reached:

Our price target of 0.30$ was reached.