Key Insights:
- On Tuesday, XRP joined the broader crypto market in the red, falling by 1.73% to end the session at $0.39142.
- Fed Fear weighed on riskier assets and overshadowed SEC v Ripple optimism.
- The technical indicators turned bearish, signaling a return to sub-$0.38.
On Tuesday, XRP fell by 1.73%. Partially reversing a 3.17% rally from Monday, XRP ended the day at $0.39142. Despite the bearish session, XRP revisited the $0.40 handle for the second time in five sessions.
A bullish start to the day saw XRP rise to a mid-morning high of $0.40222. Falling short of the First Major Resistance Level (R1) at $0.4121, XRP slid to a late afternoon low of $0.38761. However, steering clear of the First Major Support Level (S1) at $0.3810, XRP briefly revisited $0.3949 before easing back.
Ripple Updates and SEC v Ripple Chatter Take a Back Seat to Fed Fear
It was a busy Tuesday session. Following the US holidays, US private sector PMI numbers for February drew interest in the afternoon session. A better-than-expected Services PMI fueled bets of a more hawkish Fed interest rate trajectory to bring inflation to target.
The NASDAQ Composite Index responded to the more hawkish Fed outlook, sliding by 2.50%.
Ripple news updates and SEC v Ripple chatter took a backseat, despite ongoing optimism toward the outcome of the SEC v Ripple case.
However, there were no SEC v Ripple case updates to influence buyer appetite.
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Investors should continue to monitor chatter relating to the SEC v Ripple case. Binance, FTX, and Silvergate Bank updates will also draw interest.
However, we expect SEC activity and US lawmaker chatter to remain the key driver, barring a ruling from the Courts on the SEC v Ripple case.
The FOMC meeting minutes and Fed chatter will influence the broader crypto market. Hawkish minutes and FOMC member commentary would support the expectations of a more aggressive Fed interest rate trajectory.
XRP Price Action
At the time of writing, XRP was down 0.50% to $0.38947. A bearish start to the day saw XRP fall from an opening price of $0.39199 to a low of $0.38914.
Technical Indicators
XRP needs to move through the $0.3938 pivot to target the First Major Resistance Level (R1) at $0.3999 and the Tuesday high of $0.40222. A return to $0.40 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 $0.4084 and resistance at $0.41. The Third Major Resistance Level (R3) sits at $0.4230.
Failure to move through the pivot would leave the First Major Support Level (S1) at $0.3853 in play. However, barring an extended broad-based crypto sell-off, XRP should avoid sub-$0.3750. The Second Major Support Level (S2) at $0.3791 should limit the downside. The Third Major Support Level (S3) sits at $0.3645.
The EMAs and the 4-hourly candlestick chart (below) sent a bearish signal.
At the time of writing, XRP sat below the 200-day EMA, currently at $0.39119. The 50-day EMA converged on the 200-day EMA, with the 100-day EMA narrowing to the 200-day EMA. The signals were bearish.
A bearish cross of the 50-day EMA through the 200-day would support a fall through S1 ($0.3853) to give the bears a run at sub-$0.38 support levels. However, an XRP move through the EMAs would bring R1 ($0.3999) and the Tuesday high of $0.40222 into play. A move through the 50-day EMA would send a bullish signal.
