Ripple (XRP) price has been in an uptrend since December 19, when it validated a long-term ascending support line for the sixth time. A positive resolution to its SEC case could have a positive impact on the price.
XRP is the original token of Ripple Labs, created by Jed McCaleb and Chris Larsen. It acts as a payment network for global payments, offering almost instantaneous transactions at negligible cost.
Ripple Labs has been in a legal battle with the SEC (Securities and Exchange Commission) for two years. If the case is resolved in favor of Ripple, it could have a positive effect on the XRP price.
XRP price surges on long-term support
XRP price has been rising since June 14 with an ascending support line. The line has caused several bounces so far, most recently on December 19 (green icon). So far, each bounce has led to a significant upward move and even formed a bullish engulfing candlestick (highlighted) on November 14.
This line has been in its place for 192 days, due to which its importance has increased. Consequently, a break below this could lead to a significant decline in XRP price.
Technical indicators are indecisive. This is visible in the daily RSI, which has started rising but is still below 50. Furthermore, the indicator has not generated any bullish divergence.
If the upside momentum continues, there will be resistance at $0.385. On the other hand, a break above this line could take the digital asset below $0.30.
Has the short-term rally started?
Technical analysis from the six-hour time frame is more bullish than the daily. The chart shows that XRP price broke a descending resistance line after the RSI generated a bullish divergence (green line). The increase has accelerated in the last 24 hours.
XRP price is facing a minor resistance at $0.375. If it successfully moves above it, a move towards $0.385 would be expected. On the other hand, a rejection from the $0.357 area could lead to a retest of the long-term ascending support line.
Since the lines are weakened each time they touch, this can lead to breakdown.
To conclude, the direction of XRP price action is unclear. However, there are chances of an early relief rally towards $0.385. Once the price reaches there the reaction will determine the future momentum.
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