XRP and a Return to $0.50 Could Rest in the Hands of the Hinman Docs

Key Insights:

• On Saturday, XRP slid by 2.46% to end the day at $0.40312.
• XRP joined the broader crypto market in the red, with profit-taking leading to a partial reversal of Friday’s gains.
• However, the technical indicators are bullish, with XRP sitting above the 50-day EMA, signaling a return to $0.45.

On Saturday, XRP fell by 2.46%. Partially reversing a 5.14% rally on Friday, XRP ended the day at $0.40312. XRP visited $0.41 for the second time since November.

After a range-bound start to the day, XRP rose to a late morning high of $0.41640. Coming up short of the First Major Resistance Level (R1) at $0.4229, XRP slid to a late morning low of $0.39714. However, steering clear of the First Major Support Level (S1) at $0.3949, XRP revisited the $0.414 handle before falling back into negative territory.

SEC v Ripple Case Moves into Wait-and-See Mode

It was another quiet session on Saturday, with no updates from the ongoing SEC v Ripple case for investors to consider.

Following the Court filings on January 18, the SEC v Ripple case now rests in the hands of Judge Torres. Legal experts and the Ripple community expect a ruling by the end of March, though it could come sooner, with presiding judge Torres well-versed in the case that started in 2020.

For XRP, the most favorable outcome would be for the judge to deny the SEC’s Summary Judgment Reply brief and rule in favor of the Defendants’ Reply brief. Should the judge deny both Reply briefs, it could come down to the William Hinman speech-related documents.

A ruling against the SEC’s motion to redact content from the documents and a jury trial could force the SEC down the settlement road.

Talking from Davos, Ripple CEO Brad Garlinghouse had this to say about the Hinman speech-related documents,

“When those come to light, I think you will see more kind of like, how is it possible for the SEC to decide to bring a case against Ripple given what they were saying within their own walls.”

As background, former SEC Director of the Division of Corporation Finance William Hinman said that Bitcoin (BTC) and Ethereum (ETH) are not securities. The contentious issue with the speech related to Hinman’s connection with Simpson Thacher, which is part of a group that promotes Enterprise Ethereum. After leaving the SEC, Hinman returned to Simpson Thacher.

XRP Price Action

At the time of writing, XRP was down 0.58% to $0.40544. A mixed start to the day saw XRP fall to an early low of $0.40278 before rising to a high of $0.40610.

Technical Indicators

XRP needs to move through the $0.4056 pivot to target the First Major Resistance Level (R1) at $0.4140 and the Saturday high of $0.4164. A return to $0.41 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 another extended rally, XRP would likely test the Second Major Resistance Level (R2) at $0.4248. The Third Major Resistance Level (R3) sits at $0.4441.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.3947 in play. However, barring another extended sell-off, XRP should avoid sub-$0.39 and the Second Major Support Level (S2) at $0.3863. The Third Major Support Level (S3) sits at $0.3670.

The EMAs and the 4-hourly candlestick chart (below) sent a bullish signal.

At the time of writing, XRP sat above the 50-day EMA, currently at $0.39052. The 50-day EMA pulled away from the 200-day EMA, with the 100-day EMA widening from the 200-day EMA. The signals were bullish.

A hold above S1 ($0.3947) and the 50-day EMA ($0.39052) would support a breakout from R1 ($0.4140) to target R2 ($0.4248) and $0.43. However, a fall through S1 ($0.3947) and the 50-day EMA ($0.39052) would bring S2 ($0.3863) and the 100-day EMA ($0.37951) into view. A pullback from the 50-day EMA would be a bearish signal.