XRP at Risk of Sub-$0.70 on SEC v Ripple Appeal Updates

Bob Mason
Updated: Jul 22, 2023, 02:20 GMT+00:00

XRP continued to retreat from the post-SEC v Ripple ruling high of $0.9337, with news of the SEC planning to appeal the Judge Torres ruling weighing.

XRP Tech Analysis - FX Empire

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Key Insights:

  • On Friday, XRP joined the broader market in the red for a second session, falling 2.81% to end the day at $0.7722.
  • SEC appeal news sends XRP further back from the post-SEC v Ripple ruling high of $0.9337.
  • However, the technical indicators remain bullish, supporting a return to $0.80.

On Friday, XRP fell by 2.81%. Following a 3.13% loss on Thursday, XRP ended the day at $0.7722. XRP came up short of $0.80 for the first time in three sessions.

XRP weekly chart remains bullish.
XRPUSD 220723 Weekly Chart

XRP Price Action

This morning, XRP was down 0.40% to $0.7691. A bearish start to the day saw XRP fall from an early high of $0.7743 to a low of $0.7684. Significantly, XPR fell through the lower level of the $0.7870 – 0.7737 support band.

Daily Chart

The Daily Chart showed XRP/USD sitting below the $0.7870 – $0.7737 support band. However, XRP sat well above the 50-day ($0.5761) and 200-day ($0.4873) EMAs, sending bullish near and longer-term price signals.

Notably, the 50-day EMA pulled further away from the 200-day EMA, affirming a bullish near-term trend.

Despite the bearish Friday session, XRP/USD avoided sub-$0.75. However, the fall through the $0.7870 – $0.7737 support band brings sub-$0.75 into play.

Looking at the 14-Daily RSI, the 67.65 reading sends bullish XRP price signals, aligning with the EMAs. The RSI supports a move through the $0.7870 – $0.7737 support band to retarget $0.80.

XRP Daily Chart sends bullish signals.
XRPUSD 220723 Daily Chart

4-Hourly Chart

Looking at the 4-Hourly Chart, the XRP/USD faces strong resistance at $0.80. The bearish Friday session left XRP/USD below the $0.7870 – $0.7737 support band.

However, XRP sits above the 50-day ($0.7365) and 200-day ($0.5964) EMAs, sending bullish signals over the near and longer-term time horizons. Significantly, the 50-day EMA pulled further away from the 200-day EMA, supporting a move through the $0.7870 – $0.7737 support band to retarget $0.80.

The 14-4H RSI reading of 47.69 sends bearish XRP price signals, with selling pressure outweighing buying pressure. Significantly, the RSI signals near-term bearish momentum, signaling a fall through the 50-day EMA ($0.7365), a near-term bullish trend reversal event.

4-Hourly Chart indicators send mixed signals.
XRPUSD 220723 4 Hourly Chart

SEC Appeal Threat Overshadows Favorable Ripple-Related News

It was a quiet Friday session. There was no SEC v Ripple Court-related activity to draw interest. However, investors continue waiting to see whether the SEC and Ripple provide Judge Sarah Netburn with three mutually convenient dates to schedule a settlement conference.

On Monday, Judge Netburn issued a Court Order calling on the SEC and Ripple to find three mutually convenient dates to schedule a settlement conference, with the caveat that both parties believe it would be productive at this time.

It could be a long wait for those in hope of a settlement.

Defense attorney James Filan shared a WSJ article and the SEC pleading in the Terraform Labs/Do Kwon case, saying,

“In the SEC v Terraform Labs/Do Kwon case, the SEC has filed a pleading discussing Judge Torres’s decision in SEC v Ripple in which it states that SEC staff is considering the various available avenues for further review and intends to recommend that the SEC seek such review. SEC Says XRP Ruling Was Wrong, Signals It Will Appeal.”

Amicus Curiae attorney John Deaton responded to the appeal news by referencing the footnote of the Court ruling, saying,

“The common enterprise factor is even more difficult for the SEC to meet than the third factor of the Howey test. Even if the SEC was successful appealing Judge Torres ruling, all that happens is a Remand, and Judge Torres will likely decide the SEC failed to prove the common enterprise factor between Ripple and XRP holders in the secondary market.”

Deaton also pointed out that the SEC flip-flopped the common enterprise theory on three separate occasions before arguing that XRP represented the common enterprise.

For the XRP Community and XRP investors, an appeal could take years, not months, and would adversely affect XRP and the US digital asset space.

An SEC appeal, at the expense of the US taxpayer, should give US lawmakers more incentive to introduce an appropriate regulatory framework that ends the SEC rein of regulation by enforcement that has left market players exploring overseas expansion opportunities.

The Day Ahead

SEC v Ripple Court ruling-related chatter will remain the focal point. The SEC appeal-related news erased hopes of a settlement, leaving investors to monitor the news wires for an SEC filing this weekend.

However, beyond the SEC and Ripple, we expect Binance and Coinbase-related news to move the dial.

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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