Reserve Rights back pegging its eUSD and become fully collateralized, but will it last for long?
|- Reverse Rights price should be seen higher towards $0.0055.
- RSR takes a step back and heads back to lower as bears buck the trend.
- Bulls are set to come in and defend at $0.0035 as the US dollar has strengthened again on Friday.
Reserve Rights (RSR) price was primed to pop above the 55-day Simple Moving Average this week and barely came toward it. Instead, price action is being sent back lower although the stablecoin is fully activated again and pegged to the US dollar. Unfortunately, RSR will not enjoy its status for long as the US dollar is flirting with a new batch of strength that could see the eUSD peg breaking down again.
Reserve Rights is set to undergo the law of physics again
Reserve Rights price is set to tank just after USDC was able to peg the stablecoin again onto the underlying US Dollar and T-notes. It does not come as a surprise that the peg got restored right on the moment when the DOllar-index had hit a multiple-month low and T-notes wear trading near the lowest in over a half year. As markets took a turn for the worse again on Friday, the US Dollar could start to weigh again in a negative sense for USDC and Reserve RIght as stablecoin pegs are set to break up again in the coming weeks.
It all boils down to the fact that if the US goes into recession, it will result in a much stronger US Dollar again. That would break the peg for stablecoins and see Reserve Rights price tanking lower. A revisit towards $0.0025 is not unthinkable and brings another 40% losses with it.
RSR/USD weekly chart
As the dust settles over this volatile week again, traders should take away that no real shocks have happened. SVB and Credit Suisse have been contained and no other bank is signaling distress as the US Dollar is primed to trade lower on the back of recession fears fading. That would trigger a big interest in Reserve Rights as a stable factor in the peg and could explode 120% towards $0.009 to test the red descending trend line.
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