XRP Bears Eye Sub-$0.45 on SEC v Ripple Case Silence

Key Insights:

• On Friday, XRP ended a six-day losing streak, gaining 1.39% to end the day at $0.46769.
• US economic indicators eased fears of an economic recession, supporting XRP and the broader crypto market.
• However, the technical indicators remained bearish, signaling a return to $0.43.

On Friday, XRP rose by 1.39%. Reversing a 0.42% loss from Thursday, XRP ended the day at $0.46769. While XRP ended a six-day losing streak, XRP revisited sub-$0.46 for the fifth consecutive day.

After a choppy morning, XRP fell to a midday low of $0.45460. XRP fell through the First Major Support Level (S1) at $0.4559 before rising to a late afternoon high of $0.47049. XRP broke through the First Major Resistance Level (R1) at $0.4658 to test the Second Major Resistance Level (R2) at $0.4704 before easing back.

US Jobs Report Shifts Investor Focus away from the SEC v Ripple Case

There were no SEC v Ripple case updates to provide direction. The lack of Court Rulings disappointed the XRP Community, hoping for Court rulings by the end of the week.

However, Amicus Curiae attorney John Deaton had this to say,

“I’m confident Judge Torres recognizes the huge public interest and will act accordingly. I believe she shoots down the SEC’s crazy over broad theory but until we read the exact language no one can predict whether Coinbase or even Ripple will list XRP on their platforms immediately.”

Deaton responded to a discussion on a Coinbase-Ripple meeting and whether it related to the listing of XRP on Coinbase.

While the comments drew interest, US economic indicators supported a bullish XRP afternoon session.

US Nonfarm payrolls jumped by 253k in April versus a forecasted 180k increase. In March, nonfarm payrolls rose by 165k. Significantly, average hourly earnings were up 4.4% year-over-year versus 4.3% in March. Economists forecast average hourly earnings to increase by 4.2%. The US unemployment rate fell from 3.5% to 3.4% versus a forecasted 3.6%.

The Jobs Report eased recessionary fears, supporting riskier assets. However, the Jobs Report failed to fuel bets on a 25-basis point June interest rate hike.

According to the CME FedWatch Tool, the probability of a 25-basis point June interest rate hike rose from 0.0% to 8.5%. The Jobs Report did wipe out bets of a June rate cut, with the chances of a rate cut falling from 9.2% to 0.0%.

The Day Ahead

SEC v Ripple case-related will remain the key drivers. XRP faces downward pressure in May, with a lack of progress in the XRP case being a bearish XRP price scenario.

The ongoing case also leaves XRP sensitive to regulatory and lawmaker activity, leaving Binance and Coinbase (COIN)-related news and SEC activity to influence.

On Friday, reports of the DoJ investigating Binance for breaching Russian sanctions capped XRP gains.

XRP Price Action

At the time of writing, XRP was down 0.85% to $0.46373. A mixed start to the day saw XRP rise to an early high of $0.46947 before falling to a low of $0.46338.

Technical Indicators

Resistance & Support Levels

XRP needs to move through the $0.4643 pivot to target the First Major Resistance Level (R1) at $0.4739. A move through the Friday high of $0.47049 would signal a bullish session. However, SEC v Ripple chatter and the crypto news wires must support a breakout session.

In the case of an extended rally, XRP would likely test the Second Major Resistance Level (R2) at $0.4802. The Third Major Resistance Level (R3) sits at $0.4960.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.4580 in play. However, barring a crypto event-fueled sell-off, XRP should avoid sub-$0.45 and the Second Major Support Level (S2) at $0.4484. The Third Major Support Level (S3) sits at $0.4325.

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 $0.46530. The 50-day EMA eased back from the 200-day EMA, with the 100-day EMA pulling back from the 200-day EMA. The EMAs delivered bearish signals.

A move through the 50-day ($0.46530) and 100-day ($0.47130) EMAs would support a breakout from the 200-day EMA ($0.47321) and R1 ($0.4739) to target R2 ($0.4802). However, failure to move through the 50-day EMA ($0.46530) would leave S1 ($0.4580) in view. A move through the 50-day EMA would send a bullish signal.