Following XRP’s recent legal victory against the U.S. Securities and Exchange Commission (SEC), a wave of optimism has swept through the cryptocurrency community. The removal of a significant regulatory barrier has paved the way for potential institutional adoption and the tantalizing possibility of an XRP ETF.
Post-settlement, daily trading volumes skyrocketed by 208% to reach $12.4 billion, with industry analysts now estimating a high probability of ETF approval by October 2025.
Despite these positive developments, recent price movements suggest a hint of caution. Over a 24-hour period ending on August 12, XRP experienced a modest 4% dip from $3.19 to $3.13, even after hitting an intraday high of $3.32.
A notable surge in selling activity during the 19:00 hour, totaling 73.87 million in volume, indicates that significant holders may be capitalizing on profits. While support has shown resilience at $3.12, formidable resistance levels persist between $3.27 and $3.32.
Signs of Bearish Momentum
Technical experts are closely monitoring XRP’s two-week chart for a potential bearish signal: a divergence where price reaches higher peaks while the relative strength index (RSI) registers lower highs. This pattern bears resemblance to the market conditions seen during the 2017–2018 peak, which preceded a prolonged downward trend.
If history repeats itself, XRP might retreat towards its 50-period exponential moving average, located around $1.64, representing a substantial 45% drop from current levels, before encountering significant support. Intermediate demand zones could materialize in the $1.90–$2.00 range, although the current bearish setup suggests a waning momentum.
While a correction of this magnitude may not necessarily signal the end of the broader bullish trend, it could serve to shake out overextended traders, recalibrate market sentiment, and establish a more sustainable upward trajectory in the future.
Challenges and Opportunities Ahead for XRP
On the flip side, bullish investors present an alternative scenario. XRP is currently testing the $3.55 resistance level, a key barrier from the 2018 rally, and has broken out of a multi-year symmetrical triangle pattern.
A successful breach of the $3.55 mark with robust volume could pave the way for further gains towards $4.41 and possibly $5.68, particularly if regulatory bodies in the U.S. greenlight an XRP ETF and major stakeholders shift towards accumulating XRP.
Ripple’s strategic focus on long-term infrastructure development, partnerships in central bank digital currencies (CBDCs), and the tokenization of real-world assets could provide a solid foundation for sustained demand, even amidst short-term price fluctuations.
Nevertheless, uncertainties stemming from broader economic conditions, large-scale asset movements by influential players, and technical obstacles continue to pose challenges that traders need to monitor closely. At this critical juncture, XRP finds itself at a pivotal moment, teetering between validating the ominous bearish signal for a significant decline or breaking through resistance levels to extend its post-SEC rally.
Image Source: ChatGPT, XRPUSD chart from Tradingview
