XRP Poised for Massive Rally After Six Years of Consolidation, Says Analyst

• XRP is set to break out of a 6-year consolidation pattern, indicating a potential major price rally ahead.
• The SEC lawsuit against Ripple Labs continues to weigh on XRP, affecting its listing on various exchanges.
• Regulatory clarity is crucial for XRP’s future, with Ripple CEO advocating for clear, codified rules in the US.

Ripple’s XRP appears ready for a major upward move, breaking out of a six-year consolidation pattern. Crypto Analyst Mikybull Crypto predicts a rally could follow, driven by historical patterns and current technical formations.

Technical Analysis of XRP

A detailed technical analysis indicates XRP has been consolidating within a symmetrical triangle pattern since 2018. This pattern mirrors a similar formation seen from 2014 to 2017. The previous breakout led to a substantial price increase. Current projections suggest a similar bullish breakout is imminent. 

The analysis identifies key points within the triangle, labeled 1 to 4, with point 4 nearing completion at the convergence of upper and lower trendlines. A Fibonacci retracement level at 0.382 acts as a support level, reinforcing the bullish outlook.

Source: Mikybull Crypto on X

Volume indicators show stable trading volumes, with a notable spike around 2017. The Elliott Wave Theory applied to this analysis suggests we are in wave 4, anticipating an upward move to wave 5. This aligns with the pattern’s predicted breakout and projected price increase.

Impact of SEC Lawsuit

Despite positive technical signals, XRP’s price has been under pressure due to ongoing regulatory challenges. In late 2020, the US Securities and Exchange Commission (SEC) filed a lawsuit against Ripple Labs, claiming XRP is an unregistered security. This lawsuit has led to many exchanges delisting XRP to avoid regulatory issues.

The outcome of this lawsuit is crucial for XRP’s future. A victory for Ripple Labs could lead to wider adoption by financial institutions. However, if the SEC prevails, XRP might face more delistings, severely impacting its market presence.

Regulatory Clarity and Industry Outlook

Ripple CEO Brad Garlinghouse has been vocal about the need for clear regulatory frameworks in the US. He contrasts the current situation with countries like the UK, Japan, Singapore, and the European Union, where regulations are more defined. Garlinghouse revealed that Ripple has spent over $150 million in legal battles with the SEC, expressing frustration over the regulatory ambiguity in the US.

A recent crypto roundtable in Washington, D.C., attended by key political figures and industry leaders, showed promising signs of a shift in regulatory approach. Garlinghouse criticized SEC Chair Gary Gensler’s enforcement-focused regulation strategy and emphasized the need for clear, codified rules. Legislative momentum towards establishing such regulations is building, with recent developments like the FIT 21 Act passing the House.