XRP and a Return to $0.40 in the Hands of SEC v Ripple Rulings

Key Insights:

• On Tuesday, XRP joined the broader market in positive territory, rising by 0.08% to end the day at $0.3738.
• Easing Silicon Valley Bank and Signature Bank contagion risk and US inflation numbers delivered support.
• However, the technical indicators remained bearish, signaling a return to sub-$0.35.

On Tuesday, XRP rose by 0.08%. Following a 0.11% loss on Monday, XRP ended the day at $0.37380. Significantly, XRP avoided sub-$0.36 levels for the first time in three sessions.

A choppy start to the day saw XRP fall to a mid-morning low of $0.36677. Steering clear of the First Major Support Level (S1) at $0.3600, XRP rallied to a mid-afternoon high of $0.38805. XRP broke through the First Major Resistance Level (R1) at $0.3842 before easing back to end the day at sub-$0.38 for the sixth consecutive session.

US Economic Indicators and Easing SVB Contagion Deliver Support

There were no SECv Ripple case updates to provide XRP price direction on Tuesday. The lack of news from the Courts left XRP in the hands of the US economic calendar.

However, Silicon Valley Bank (SIVB) and Signature Bank (SBNY) collapse-related chatter was also influential.

On Monday, US President Joe Biden reportedly said,

“Americans can rest assured that our banking system is safe. Your deposits are safe. Let me also assure you we will not stop at this. We will do whatever is needed on top of all this.”

While Biden’s words delivered support, the US CPI Report sent XRP to a session high. In February, the annual inflation rate softened from 6.4% to 6.0%, in line with forecasts. The softer headline figure supported a less aggressive Fed interest rate trajectory to bring inflation to target.

XRP jumped by 2.02% to $0.37578 within the first 30 minutes of the report.

The Day Ahead

SEC v Ripple case updates will remain the key driver. Investors await rulings relating to the Hinman Documents and Summary Judgment Reply Briefs, amongst others.

However, investors should continue monitoring Binance and FTX news, regulatory activity, and lawmaker chatter.

Following the moves to protect SVB and SBNY depositors, regulators and lawmakers could target the digital asset space to turn the attention away from the US banking sector.

Economic indicators from China and the US will also influence investor appetite today. Overnight, the US CPI Report supported a 25-basis point Fed interest rate hike in March. Softening inflation and upbeat US consumption figures are a bullish combination for riskier assets.

XRP Price Action

At the time of writing, XRP was down 0.39% to $0.37236. A mixed start to the day saw XRP rise to an early high of $0.37388 before falling to a low of $0.37019.

Technical Indicators

XRP needs to move through the $0.3738 pivot to target the First Major Resistance Level (R1) at $0.3856 and the Tuesday high of $0.38805. A return to $0.38 would signal a bullish session. However, the broader crypto market and SEC v Ripple chatter would need to support a breakout.

In the case of an extended rally, XRP would likely test the Second Major Resistance Level (R2) at $0.3975 and resistance at $0.40. The Third Major Resistance Level (R3) sits at $0.4188.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.36677 in play. However, barring an extended broad-based crypto sell-off, XRP should avoid sub-$0.36 and the Second Major Support Level (S2) at $0.3549. The Third Major Support Level (S3) sits at $0.3336.

The EMAs and the 4-hourly candlestick chart (below) sent bearish signals.

At the time of writing, XRP sat below the 50-day EMA, currently at $0.37254. The 50-day EMA slipped back from the 100-day EMA, with the 100-day EMA easing back from the 200-day EMA. The EMAs delivered bearish signals.

A move through the 50-day EMA ($0.37254) would support a breakout from the 100-day EMA ($0.37519) to give the bulls a run at the 200-day EMA ($0.37951) and R1 ($0.3856). However, failure to move through the 50-day EMA ($0.37254) would leave S1 ($0.3644) in play.