XRP and a Return to $0.55 Remains Elusive as SEC v Ripple Case Drags On

Key Insights:

• On Thursday, XRP joined the broader crypto market in negative territory, falling by 0.66% to end the day at $0.50313.
• Increased lawmaker scrutiny and a lack of updates from the ongoing SEC v Ripple case left XRP on the back foot.
• The technical indicators are bullish, signaling a return to $0.55.

On Thursday, XRP fell by 0.66%. Reversing a 0.55% gain from Wednesday, XRP ended the day at $0.50313. XRP wrapped up the day at $0.50 for the third consecutive session.

Tracking the broader market, XRP fell to a late morning low of $0.49166. XRP fell through the First Major Support Level (S1) at $0.4947 before rising to a mid-afternoon high of $0.50982. However, falling short of the First Major Resistance Level (R1) at $0.5223, XRP fell back to end the day at sub-$0.5050.

US Lawmaker Scrutiny Overshadowed Hopes of a Ripple Victory

It was a quiet Thursday. There were no SEC v Ripple case updates to provide direction. The lack of updates left XRP in the hands of US lawmaker chatter and the broader crypto market.

On Thursday, the US Department of the Treasury published a review of the DeFi space, highlighting bad actors and necessary regulatory reforms. While the publication was broad, it was another swipe at the digital asset space and association of illicit activity with cryptos.

SEC Chair Gary Gensler was active on Twitter. Overnight, the SEC Chair tweeted,

“There’s nothing incompatible in the crypto mkts w/ the securities laws. A goal of our work at the SEC is to bring this field into compliance. That way, investors get the same time-tested protections they get elsewhere in the markets.”

The Day Ahead

Investors should monitor the crypto news wires and Twitter chatter. Updates from the SEC v Ripple case would have a material impact. However, a lack of updates will leave regulatory activity in the spotlight.

Binance and Coinbase (COIN)-related news will also move the dial.

Away from the crypto market, the US Jobs Report will influence the afternoon session. The global financial markets are on a knife edge. Weaker numbers could further fuel recessionary fears, while hotter-than-expected numbers would raise expectations of another Fed interest rate hike to tackle sticky inflation.

XRP Price Action

At the time of writing, XRP was down 0.07% to $0.50278. A mixed start to the day saw XRP fall to an early low of $0.49987 before rising to a high of $0.50415.

Technical Indicators

XRP needs to avoid the $0.5015 pivot to target the First Major Resistance Level (R1) at $0.5114. A move through the Thursday high of $0.50982 would signal a bullish session. However, 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 $0.5197 and resistance at $0.52. The Third Major Resistance Level (R3) sits at $0.5379.

A fall through the pivot would bring the First Major Support Level (S1) at $0.4933 into play. However, barring an extended sell-off, XRP should avoid sub-$0.4850 and the Second Major Support Level (S2) at $0.4834. The Third Major Support Level (S3) sits at $0.4652.

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

At the time of writing, XRP sat below the 50-day EMA, currently at $0.50420. The 50-day EMA moved away from the 100-day EMA, with the 100-day EMA widening from the 200-day EMA. The EMAs delivered bullish signals.

A move through the 50-day EMA ($0.50420) would support a breakout from R1 ($0.5114) to target R2 ($0.5197) and $0.52. However, failure to move through the 50-day EMA ($0.50420) would leave S1 ($0.4933) in play. A move through the 50-day EMA would send a bullish signal.