- XRP price is trading inside an ascending parallel channel, hinting at a bullish move shortly.
- Ripple is forming a bullish pennant on a lower time frame that could trigger a 47% advance.
- A steady increase in daily active addresses suggests rising interest among users, supporting an optimistic outlook.
XRP price has been on an impressive upswing over the past month. While most altcoins are retracing, Ripple has managed to stay afloat without intense drawdowns.
Going forward, XRP price should likely experience a similar uptrend.
XRP bullish outlook from a long-term perspective
XRP price has set up higher highs and higher lows since November 2020. Drawing trend lines that join these swing points reveals the formation of an ascending parallel channel. Although a breakout from this technical formation is bearish, the massive nature of the pattern shows Ripple is on a journey from one end of the channel’s trend line to another.
Since pointing out the setup, XRP price has managed to rally 62% but has retraced 12% to where it currently trades at $1.17.
The last two times the remittance token bounced off the lower trend line of the channel, it eventually touched the upper ceiling. Assuming XRP price is doing something similar puts roughly 180% gains on the table to its all-time high at $3.31.
This run-up will not be a piece of cake. It will encounter $1.27, a brutal resistance barrier that has prevented its previous rally, and the $1.70 ceiling before having a chance to head to the 2018 all-time high at $3.31.
To add to the bullish outlook, Ripple shows the formation of a fair value gap (FVG) ranging from $1.30 to $1.60 (highlighted in orange). During the May 19 crash, the XRP price quickly moved away from $1.60 to $1.30 without any impulse moves, leaving a gap and creating inefficiency.
While some volatile altcoins have already filled their respective FVGs, the XRP price has not yet. A decisive daily candlestick close above $1.30 will open a least-resistance path to $1.60.
Therefore, market participants can expect an increased bullish activity as Ripple breaches the $1.27 supply barrier.
XRP/USDT 1-day chart
Short-term charts show imminent gains on the horizon
Although the longer time frame charts paint a bullish picture, a second look at the 4-hour chart shows XRP price is forming a bullish pennant.
The 47% surge that took place between August 12 and August 15 resulted in a flagpole, while the ongoing consolidation period that followed since then created the pennant.
This continuation pattern signals a 47% upswing to $1.87, determined by measuring the flagpole’s height and adding it to the breakout at $1.27.
Therefore, a 4-hour candlestick close above $1.27 is imperative for the bullish outlook to play out.
A successful breakout puts XRP price just above the third hurdle at $1.87, opening the path to the 2018 all-time high at $3.31, as discussed above.
XRP/USDT 4-hour chart
Increasing investor interest
While the upswing in XRP price is already palpable, on-chain data reveals that the number of users interacting with the XRP Ledger (XRPL) is rising at a steady rate.
The number of daily active addresses on the XRPL grew from 9,233 on July 25 to 23,537 on August 24. This 176% spike in users indicates a rising interest and a proxy to investor interest and a potential inflow of capital.
XRP daily active addresses chart
The 365-day Market Value to Realized Value (MVRV) model, currently hovering around 64%, goes against the bullish outlook discussed above.
This fundamental index tracks the average profit/loss of investors that purchased XRP over the past year. A high MVRV value indicates that a large portion of holders are in profit, which increases the chances of a crash if these participants begin to realize their gains.
Therefore, traders or holders need to pay close attention to exchange inflows or a spike in large transactions that generally serve as a precursor to a flash crash.
XRP MVRV 365-day chart
Therefore, a sudden spike in selling pressure could quickly push the XRP price to retest the $1.09 support level. A breakdown of this barrier would reveal a bearish development and open up the possibility of tagging the subsequent support floor at $0.90.
If the momentum builds up, Ripple might produce a swing low below $0.91, invalidating the bullish thesis. In a highly bearish case, XRP price could also retest $0.77, which would constitute a 30% crash from the $1.09 support level.
XRP Lawsuit: SEC aims to make XRP skip the bull run with an Expert Discovery Extension Appeal
The latest update in the XRP lawsuit saw the SEC file a letter requesting the Court to extend the expert rebuttal report deadline to November 12, 2021, and the expert discovery deadline to January 14, 2022, from the former date of November 12, 2021. The plaintiff noted that the extension will allocate both parties sufficient time to prepare rebuttal reports and depose a minimum of 14 expert witnesses.
Ripple Opposes SEC extension appeal to save XRP from an isolated bear run
While consenting to the extension of the rebuttal report deadline until November 12, Ripple opposes the January 14 deposition deadline to avoid the case from stretching long enough for XRP to entirely miss the bull run. Furthermore, Ripple also intends to file an opposition to this letter motion on October 18, 2021.
The SEC offered a compromise to Ripple, preponing the expert discovery extension to December 22, but the defense has rejected that offer as well. Ripple argues that the extension would “would likely impact the briefing schedule for summary judgment motion[s].”, as post-December 10, 2021, the Thanksgiving holidays will commence the holiday season.
SEC supports extension appeal with pending motions
The SEC objects that the case is even less ready for summary judgment motions as expert discovery has commenced with an incomplete factual record. The commission noted that on September 1, 2021, Magistrate Judge Netburn granted the SEC’s motion to compel Ripple to produce certain instant messages among its employees, but Ripple has not completed its production of responsive documents and has not provided any timetable by which it will be complete. Along with the incomplete discovery of a granted motion, the plaintiff states that the parties have a total of four pending discovery motions before Magistrate Judge Netburn. The plaintiff claims that even if one motion is granted, the parties will require an additional extension to proceed with the discovery.
“If Magistrate Judge Netburn grants any of the pending motions to compel, at minimum, the parties would need additional time to review and produce the documents at issue…The SEC’s proposed extension is fair and reasonable under the circumstances and should be granted for good cause.”, stated the SEC.
SEC v. Ripple Labs: Agency opposes motion to seal documents citing ‘influence’
The SEC v. Ripple Labs lawsuit is in the news today after yet another crucial development. According to the latest updates from the court, the regulators have responded in opposition to Ripple’s motion to seal transcripts of audio and video recordings from internal meetings.
As per the filing shared by @CryptoLawUS, the SEC claimed that the documents “have the tendency to influence the Court’s ruling on the discovery dispute before it.” The tables turned for Ripple when SEC added that “no countervailing business or privacy interests outweigh their disclosure to the public.”
On 30 August, the SEC had filed a motion to compel the production of some audio and video-taped recordings after Ripple failed to disclose them during discovery. Ripple agreed to produce these recordings, along with “all recorded meeting by the custodians of such meeting, meeting name, and other criteria” for responsive documents.
The SEC later filed another motion to compel Ripple on 1 October to conduct a “reasonable search.” Here, the intent was to find more responses through recordings of meetings at which the agreed-upon custodians spoke.
The SEC has been trying to make the documents public since it found statements made by Ripple CEO Garlinghouse and other key Ripple employees. The filing added,
“These transcripts contain statements by Garlinghouse and other key Ripple employees that bear directly on whether Ripple’s offers and sales of XRP are “investment contracts” and therefore securities under SEC v. W.J. Howey Co., 328 U.S. 293, 298-99 (1946), and whether Garlinghouse and Larsen had the requisite scienter for purposes of the SEC’s aiding-and-abetting claims.”
Although the concerning statements from the transcripts have been redacted, according to the SEC, Ripple is also seeking to seal excerpts of Garlinghouse’s deposition testimony. The same apparently pertains to the frequency of “all-hands” meetings, along with a certain email from the CEO.
The SEC also argued that the transcripts of the recordings are Judicial Materials. Ones that should be disclosed to the public. Curiously, attorney Jeremy Hogan believes that the recording may be the backbone of the SEC’s case.
Nevertheless, only the Court’s decision will reveal the importance of the recordings for the people, Ripple, and the SEC.
Ripple and British firm collaborating in country’s futuristic CBDC project
- Ripple has joined the board of the UK’s Digital Pound Foundation. The foundation is pushing for the adoption of a digital pound in England.
- The Bank of England recognizes that a Central Bank Digital Currency (CBDC) will enhance financial access. The electronic pound is, therefore, the cornerstone of an equitable financial system in the UK.
Ripple says it has agreed to join the Digital Pound Foundation’s (DPF) board. DPF is a non-profit that’s pursuing the creation and adoption of the electronic pound in England.
The firms’ policy chief, Susan Friedman, will sit on the DPF board. Ripple’s joining of the foundation adds to the engagements it’s having with different nations on CBDCs. In those engagements, it has been supporting its central banks with its technical and management expertise
Ripple acknowledges the UK’s role in spearheading prudent advancement of the digital assets space. Consequently, it views the latter’s pursuit of the digital pound as a rational conclusion of those efforts.
Ripple backs the digital pound
Friedman has expressed Ripple’s excitement at the new working relationship. She reiterated that her company was happy to support DPF in creating and executing the digital pound.
Again, she’s confident that DPF will assist Britain in achieving a long-term all-embracing settlement system.
The digital pound will anchor the UK’s push for an inventive digital society. Collaboration with other digital assets will guarantee the nation’s place at the apex of the evolving digital ecosystem.
Today, many central banks are experimenting with sovereign-issued cryptocurrencies. These include CBDCs.
The Bank of England (BOE) hasn’t lagged in those endeavors too. It’s working to find solutions to the challenges of creating, adopting, and managing the electronic pound.
BOE envisions the e-pound as the key to increasing households’ and businesses’ access to funds. It also recognizes the significance of the advancing digital payments sector.
In it, the UK can look forward to a settlement system that’s capable and timely, and affordable. Such a system isn’t only viable but also has wide application.
There’s a need for broader collaboration to get there, though. The foundation understands this fact, and that’s why it’s seeking the input of other players in this space. It holds that such associations will guarantee UKs lead as the hub of financial innovation.
Ripple’s expertise in CBDC development
As they continue adopting CBDCs, central banks must grapple with several factors that may impact these projects. These include privacy, interoperability, and independence. The three are central to the banks moving funds in an affordable, dependable and timely manner.
Here’s where Ripple comes in. Its expertise in the creation and application of CBDCs creation and is a boon for the e-pound project.
Last month, Ripple said it was teaming up with Bhutan’s Central Bank, the Royal Monetary Authority (RMA), in a similar project. In the deal, the former would help RMA test an international and bulk settlements system for its e-Ngultrum.
The digital Ngultrum is Bhutan’s CBDC version of its fiat currency. Ripple is supplying the Blockchain infrastructure besides the CBDC solution for this project.
Bhutan banks on this partnership to boost digital payments. It’ll also strengthen its efforts towards increasing financial inclusion. Moreover, it’ll help the nation maintain its pledge to sustainability.
Today, Bhutan remains the world’s only carbon-neutral country. Ripple’s CBDC solution is also carbon neutral. As such, it is the perfect fit for Bhutan’s e-payments and sustainability goals.