XRP hits 13-month high versus Bitcoin with 35% daily surge — But is a correction inevitable? cryptomarketbag Altcoin update

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XRP price posted a sharp rally against Bitcoin (BTC) on continued optimism between San Francisco-based blockchain payments firm Ripple and the US Securities and Exchange Commission (SEC) about a potential solution.

Settlement rumors fueled a surge in XRP price

On September 23, the XRP/BTC pair rose to 0.00002877 – its best level in 13 months – from 0.00002132, a 35% price rally compared to bitcoin in a single day. Meanwhile, XRP is up 42% against the US Dollar in the same time frame.

XRP/BTC and XRP/USD daily price chart. Source: TradingView

The XRP market began to see major price jumps after Ripple and the SEC filed a motion for a summary judgment with the court on September 12, explaining Ripple’s ongoing legal battle over securities fraud allegations.

In other words, Ripple and the SEC agreed that the court should use available evidence to reach a ruling by December 2022 on whether the blockchain firm raised funds illegally by selling XRP, and thus avoided trial.

Since Ripple’s court filing, the price of XRP has gained about 75% and 60% against bitcoin and the dollar, respectively, driven by the optimism of a potential victory for Ripple.

The buying momentum came after Ripple CEO Brad Garlinghouse suggested in his recent interview with Fox Business on September 22.

Garlinghouse:

“People find out that the SEC is really overreacting and that they are not exercising a loyal loyalty to the law in pursuit of a result. […] The SEC has lost its way.”

XRP Sharks and Whales Are Buying From 2020

Since May, the price has also jumped amid the continuous accumulation of XRP tokens by wealthy investors.

The percentage of entities holding 1 million to 10 million XRP tokens – known as sharks and whales – increased to 6.35% overall as of September 23, 2022, from 5.43% on December 31, 2020. information From sentiment, which mentioned:

“Active shark and whale addresses holding 1m to 10m $XRP have been in an accumulation pattern since late 2020.”

XRP hits 13 month high versus Bitcoin with 35 daily surge CryptomarketBag
Active XRP shark and whale addresses. Source: Sentiment

Meanwhile, entities with over 10 million XRP tokens also hit an all-time low of 70.75% of the current supply in a given period.

Pain ahead?

Traders appear to be buying rumors following the Ripple vs. SEC ruling. But it remains to be seen whether this will turn into a “sell news” based on the outcome of the ruling, with XRP’s technicals hinting at a potential correction.

Notably, XRP has already become an overbought asset against bitcoin and the dollar.

RELATED: Total Crypto Market Cap Shows Strength Even After Merge and Federal Reserve Rate Hike

The Relative Strength Index (RSI) for XRP/BTC peaked at around 85 on 23 September, generally above the overbought threshold of 70 prior to a strong price correction or consolidation.

As shown in the chart below, XRP/BTC has already recovered about 10% from its 13-month peak. The pair now tests 0.00002601 as its short-term support, which, if broken to the downside, could test 0.00002079 as its primary downside target or a decline of 20% from current levels by the end of the year can receive.

1663940062 241 XRP hits 13 month high versus Bitcoin with 35 daily surge CryptomarketBag
XRP/BTC daily price chart. Source: TradingView

Meanwhile, XRP is seeing a similar sharp correction after crossing a path with a multi-month downtrend line resistance against the Dollar, as shown below.

1663940063 595 XRP hits 13 month high versus Bitcoin with 35 daily surge CryptomarketBag
XRP/USD three day price chart. Source: TradingView

An extended pullback from the trendline resistance could see XRP testing its near-term horizontal trendline support as its next downside target. In other words, by the end of 2022 the XRP/USD pair could drop to $0.31, which is about 40% lower than today’s price.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, so you should do your own research when making a decision.



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