Raoul Pal, CEO of Real Vision, explains why he became an XRP hodler and how to recognize the risk / reward ratio of the altcoin.

Pal said in a recent interview with Thinking Crypto that he bought a position at XRP about a year ago, with the U.S. Securities and Exchange Commission (SEC) lawsuit against payment company Ripple being a major contributing factor.

“I bought it because a) it has use cases and is being used, and b) the lawsuit presents a magical risk / reward.

It drops in price a lot and then I look at it and think, ‘Wow, where is it going? 100% discount from here on 0? But when the lawsuit is settled, it increases tenfold. “And I found ‘that’s undisputed’. Why don’t you accept a risk / reward ratio of 10-1 surrounded by a catalyst?”

The SEC filed a lawsuit against Ripple last December alleging that the San Francisco-based payment company sold XRP as an unregistered security during its launch. The regulator claims that XRP is a security to this day.

Pal said his XRP bet is wholly subject to lawsuit.

“It’s all about this case.

Because the price could not determine the direction – it was delisted everywhere. It doesn’t stop until the case is resolved because the richest and most powerful nation on earth does not allow easy investments in it. ”

What is the price of XRP at the moment?

XRP price, like most other cryptocurrencies, has shown strong signs of recovery after Saturday’s flash crash ended. A strong rebound from the lows could trigger a new uptrend for XRP.

XRP price has held strong support near the $ 0.83 value area since Sunday. Concerns about downside pressure remain, but XRP’s bullish behavior shows significant buying volume.

There is a hypothetical long trading opportunity on the chart and a reversal point of $ 0.05 / 3-box from XRP. Entry is a buy stop order at $ 1.05, a stop loss at $ 0.85, and a profit target at $ 1.75.

The entry-point based on the point-and-figure pattern is known as a bearish shakeout. This pattern is only valid if a trend reversal is expected and positioned for it. The 2 cell stop will help protect implied gains.

XRP $ 0.05 / 3-box figure and reverse graph

When a hypothetical long entry is triggered, traders should expect some resistance in the $ 1.15 and $ 1.25 areas before a significant uptrend emerges.

Bulls should note that the downside risk remains the ongoing SEC and Ripple lawsuit as the biggest unknown for XRP.

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