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SEC v Ripple: XRP Revisits $0.34 as Investors Await Court Ruling

By:
Bob Mason
Updated: Jun 16, 2022, 06:06 GMT+00:00

Following Wednesday's Fed monetary policy decision and forward guidance, XRP investor focus returns to the SEC v Ripple case. A ruling is expected in days.

SEC v Ripple - XRP driver.

Key Insights:

  • It has been a choppy first half of the week for XRP. Two consecutive days in the green reversed a Monday sell-off, leaving XRP up 0.09% for the week.
  • Reaction to the Fed rate hike and forward guidance delivered support on Wednesday, while the SEC v Ripple case remains the key driver.
  • Technical indicators remain bearish, with XRP sitting below the 50-day EMA.

On Wednesday, XRP rallied by 6.81%. Following a 3.28% rise on Tuesday, XRP ended the day at $0.3433.

A choppy day saw XRP fall through the First Major Support Level at $0.3011 to a day low of $0.2990 before making a move.

In response to the Fed monetary policy decision and Fed Chair Powell’s press conference, XRP struck a day high of $0.3461.

XRP broke through the First Major Resistance Level at $0.3339 to wrap up the day at $0.34. The Second Major Resistance Level, at $0.3465, pegged XRP back from more material gains.

While the Fed and Fed Chair Powell delivered support, the ongoing SEC v Ripple case remains the key driver.

This week, investors await a court ruling that could be a defining moment in the case. A court ruling in favor of Ripple Lab could force the SEC into a settlement and place a big question mark over the SEC’s stance on cryptos and the Howey test.

Surviving the Fed, Investors Now Await a Court Ruling in SEC v Ripple Case

This week, SEC and Ripple await a court ruling on whether William Hinman’s speech-related documents fall under the attorney-client privilege.

In 2018, the former SEC Director of the Division of Corporation Finance said that bitcoin (BTC) and ethereum (ETH) are not securities.

On Tuesday, June 7, the SEC and Ripple attended a court-scheduled conference. Judge Sarah Netburn scheduled the meeting to focus on the SEC’s claims that all documents relating to William Hinman’s 2018 speech should fall under the attorney-client privilege.

Before last week’s conference, the SEC filed at least six motions attempting to shield the Hinman speech-related documents under the attorney-client privilege.

The Ripple defense team and the XRP holders hope for a favorable court ruling. The general consensus is that the documents contain details that could damage the SEC case.

William Hinman has, inadvertently, become a central figure in the SEC v Ripple case.

In December, Empower Oversight, a non-profit government watchdog, filed a lawsuit against the SEC. The lawsuit claimed that William Hinman received millions of dollars from his former employer, Simpson Thacher.

Simpson Thacher is part of a group that promotes Enterprise Ethereum. Empower Oversight claimed that the Hinman speech caused an ETH price spike before the SEC lawsuit against Ripple Lab, claiming that XRP is a security.

XRP Price Action Hinged on SEC v Ripple

At the time of writing, XRP was down 2.10% to $0.3361.

A mixed morning saw XRP rise to an early morning high of $0.3470 before falling to a low of $0.3342.

XRP left the Major Support and Resistance Levels untested early on.

XRP in the hands of the SEC v Ripple case
XRPUSD 160622 Daily Chart

Technical Indicators

Avoiding a fall through the $0.3294 pivot would target the First Major Resistance Level at $0.3600. XRP will need the broader crypto market support to breakout from the 50-day EMA, currently at $0.3483.

In the case of a broad-based crypto rebound, XRP should test resistance at the 100-day EMA, currently at $0.3700. The Second Major Resistance Level sits at $0.3766.

A fall through the pivot would bring the First Major Support Level at $0.3130 into play. Barring an extended sell-off throughout the afternoon, XRP should avoid sub-$0.30. The Second Major Support Level sits at $0.2824.

A move through to $0.35 key near-term.
XRPUSD 160622 Hourly Chart

The EMAs and the 4-hourly candlestick chart (below) send a bearish signal. At the time of writing, XRP sat below the 50-day EMA, currently at $0.3483. Today, the 50-day EMA fell back from the 100-day EMA. The 100-day EMA eased back from the 200-day EMA, XRP price negative.

A return to $0.35 levels would support a run at the 100-day EMA. Near term, the SEC v Ripple court ruling on the Hinman docs will be the key driver.

EMAs send bearish signal.
XRPUSD 160622 4-Hourly Chart

About the Author

Bob Masonauthor

With over 20 years of experience in the finance industry, Bob has been managing regional teams across Europe and Asia and focusing on analytics across both corporate and financial institutions. Currently he is covering developments relating to the financial markets, including currencies, commodities, alternative asset classes, and global equities.

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