Especially the cryptocurrency sector Ripple Labsis embroiled in a scenario of concern and uncertainty following a controversial exchange between US Securities and Exchange Commission (SEC) Chairman Gary Gensler and the House Financial Services Committee in Congress, which could impact XRP price.
Despite Ripple being partial legal victory Against the SEC, Gensler’s position remains unchanged as he emphasized the regulatory agency’s determination to pursue summary proceedings in the ongoing case. This has led to further questions and concerns within the sector.
Congressman Highlights Ripple Case’s Far-From-Over status
During the hearing, Congressman Stephen F. Lynch said expressed his concerns about the possible pattern of lawsuits becoming the norm to determine the classification of individual tokens as securities.
Although Gensler did not respond directly, he mentioned the SEC’s filing for one interim appeal, which emphasizes the regulator’s intention to continue the legal battle. Lynch acknowledged that the case is far from over.
On August 17, Judge Torres spoke promised the SEC’s request for a preliminary appeal, giving the regulatory agency a chance to present a compelling case to the Second Circuit.
However, it is important to note that this consent only allows the SEC to file a motion for summary judgment, which provides an important opening for the regulator to challenge the prior ruling and seek a different outcome.
These recent developments, as highlighted by Congressman Lynch, indicate that resolution of the ongoing Ripple case could take quite some time.
As a result, XRP will likely stagnate, caught in a consolidation phase, or possibly a return to current levels. This could potentially push the cryptocurrency to pursue a new yearly low beyond the $0.4225 mark reached on August 17.
XRP price analysis points to a potential macro uptrend
Despite the legal battles and uncertainty surrounding the current state of the crypto market, some signals may point to another scenario, where XRP could follow a macro upward trend.
Technical analysis emphasizes a pattern resembles the last market cycle, which consists of five phases: rise, crash, retrace, reaccumulation, and final breakout.
In parallel with previous cycles, many currencies have experienced explosive growth beyond their previous all-time highs following the reaccumulation phase.
For example, Bitcoin has gone through its reaccumulation phase during the COVID-19 pandemic. Still, as a result of the ongoing lawsuit, XRP has entered an extended reaccumulation phase in the form of an Elliott wave triangle, similar to the previous cycle.
Currently, the market is in phase E, which indicates a possible return to the upside followed by another dip to lower levels. Ultimately, a breakout from this massive triangle is expected, leading to a new all-time high, likely happening next year or the year after.
While some argue that the fate of the XRP price depends on the performance of Bitcoin, it is worth noting that when comparing From this perspective, XRP is expected to significantly outperform other alternative coins.
However, for the XRP price to support a long-term uptrend in the short term, it must overcome significant resistance levels that present potential challenges. In the immediate time frame, XRP is facing resistance at $0.5132, followed by two additional formidable barriers, which are expected to be particularly challenging in the coming weeks.
XRP’s 50-day and 200-day moving averages (MAs) currently stand at $0.5194 and $0.5318, respectively. These MAs, once considered reliable support levels, have failed to hold, necessitating a major catalyst for XRP to surpass them.
This is clearly visible in the chart, which shows the partial victory on July 13, when XRP rose above both MAs. However, since August, XRP has been trading among them.
Featured image from Shutterstock, chart from TradingView.com