- Ripple lifts off the new multi-year highs despite a heated court battle with the SEC.
- The recent win in the court proves to investors that SEC could be having a weak case against the blockchain startup.
- The RSI negative divergence hints at a potential correction after XRP hit highs of $1.5.
As predicted on Friday, Ripple spiked further to hit new multi-year highs of $1.5. The rally built upon the momentum emanating from Ripple's Tuesday court case win against the United States Securities Commission (SEC). Meanwhile, the cross-border token exchanges hands at $1.33 amid the hunt for higher support.
Ripple's Legal Win Allows XRP to Chart New Path
The SEC filed a lawsuit against Ripple and its top executives Brad Garlinghouse and Chris Larsen, alleging that they raised funds through the illegal sale of unregistered security tokens. The case rubbed shoulders the wrong way with various crypto exchanges, including Coinbase, leading to delisting. In turn, XRP's value plummeted, hitting lows of $0.17, leaving investors bleeding.
However, XRP seems to be successfully sailing through the high tides, especially after the recent Ripple Labs win in court. Judge Sarah Netburn ruled that Larsen and Garlinghouse's financial information has no ground being brought into the case as the regulator failed to prove that the two have mysterious transactions. Moreover, Netburn permitted Ripple's lawyers to access the SEC's Ethereum and Bitcoin documents.
Ripple's Upward Trend Could Continue
Following the win in court, investor sentiment has improved toward XRP. Victory against the SEC would lead to relisting on the exchanges and, therefore, a potential uptick in price. At the time of writing, XRP trades at $1.3 while working to secure higher support. Reclaiming the ground above $1.4 and, by extension, price action beyond $1.5 could trigger more buy orders as bulls eye $2.
XRP/USD Four-Hour Chart
Looking at the Other Side of the Fence
The Relative Strength Index (RSI) has been rejected from the overbought region, hence the correction from $1.5. If the negative divergence continues, XRP will seek support at $1.2 or the 50 Simple Moving Average (SMA) at $1 on the four-hour chart.
The RSI also has a negative divergence following the break from the ascending price. A negative RSI divergence indicates that the momentum is losing traction amid decreasing volume. It also signifies that the bears are likely to take back control in the short term.