The Ripple price is struggling a few days after Ripple Labs unlocked $1.6 billion worth of coins from its Escrow account. XRP is trading at $1.4930, which is 25% below its April high of $1.9830. It is about 60% above its lowest level on April 23. It also has a total market cap of more than $67 billion and is the fourth-biggest digital currency in the world.
What happened: In a tweet two days ago, Whale Alert said that Ripple Labs had withdrawn $1.6 billion from its Escrow account. This is probably the reason why the XRP has struggled substantially in the past few days. Unlike most digital currencies, Ripple Labs controls the supply and demand of XRP. It holds 55% of all XRP in circulation. Since 2017, Ripple Labs releases XRP it holds in escrow every 55 months to prevent oversupply.
Meanwhile, the XRP price is reacting to news that ongoing legal case filed by the SEC. During the weekend, a lawyer of the company said that the SEC was considering filing a response to individual motions to dismiss. The response will be about 60 pages. It is still relatively early to determine who will win the suit.
The four-hour chart shows that the Ripple price has found substantial resistance at $1.6620, which is between 23.6% and 38.2% Fibonacci retracement level. The price is slightly below the 25-day and 15-day moving average (MA).
The Relative Strength Index (RSI) has declined from the overbought level of 70 to the current 45. Therefore, the XRP price may continue to drop as bears target the next the 50% Fibonacci retracement level of $1.1832. However, a move above the resistance at $1.6620 will invalidate this trend.
Please don’t consider this investment advice. Views expressed here are those of the writer and the writer and InvestingCube will not be held liable for any losses.
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