XRP Bulls to Take Another Run at $0.43 on Bullish Market Sentiment

Key Insights:

• On Wednesday, XRP rose by 1.86% to end the day at $0.41347.
• A lack of updates from the SEC v Ripple case left XRP in the hands of Fed Chair Powell and the broader crypto market.
• The technical indicators are bullish, with XRP sitting above the 50-day EMA, signaling a return to $0.45.

On Wednesday, XRP rose by 1.86%. Following a 3.12% rally on Tuesday, XRP ended the day at $0.41347. XRP avoided a return to sub-$0.39 for the first time in three sessions.

After a mixed morning, XRP fell to a late afternoon low of $0.39684. Steering clear of the First Major Support Level (S1) at $0.3923, XRP rallied to a late high of $0.4154. However, coming up against the First Major Resistance Level (R1) at $0.4154, XRP eased back to end the day at $0.41347.

Fed Chair Powell Delivered a Bullish Mid-Week Session

It was a busy Wednesday session. While there were no updates from the SEC v Ripple case to provide direction, the US economic calendar and the Fed were in focus.

Labor market numbers from the US delivered mixed results. While JOLTs reported an increase in openings from 10.440 million to 11.012 million in December, January ADP numbers disappointed. According to the ADP, nonfarm employment rose by 106k in January versus 253k in December.

Private sector PMIs were also weaker, with the ISM Manufacturing PMI falling from 48.4 to 47.4. However, while the stats were bearish, Fed Chair Powell delivered late support. Powell talked about avoiding a recession, hoping to keep rates below 5%, and the first signs of disinflation.

Updates from the SEC v LBRY case failed to deliver support, however. XRP holders are in wait-and-see mode, with rulings from the SEC v Ripple case likely to affect XRP and the broader crypto market.

Today, investors should monitor the news wires for SEC v Ripple news. However, a lack of updates would leave the broader crypto market to provide direction. FTX and Genesis updates and regulatory chatter will also draw interest.

US economic indicators will also provide direction, with jobless claims, unit labor costs, and factory and core durable goods orders in focus. We expect ongoing sensitivity to US economic indicators. A deterioration in labor market conditions and signs of a US recession would weigh on XRP and the broader market.

XRP Price Action

At the time of writing, XRP was down 0.56% to $0.41116. A mixed start to the day saw XRP rise to an early high of $0.41753 before falling to a low of $0.41064.

Technical Indicators

XRP needs to avoid a fall through the $0.4086 pivot to target the First Major Resistance Level (R1) at $0.4203. A move through the morning high of $0.41753 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 an extended rally, XRP would likely test the Second Major Resistance Level (R2) at $0.4271 and $0.43. The Third Major Resistance Level (R3) sits at $0.4457.

A fall through the pivot would bring the First Major Support Level (S1) at $0.4017 into play. However, barring a risk-off-fueled sell-off, XRP should avoid sub-$0.39. The Second Major Support Level (S2) at $0.3900 should limit the downside. The Third Major Support Level (S3) sits at $0.3715.

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 $0.40550. The 50-day EMA moved away from the 100-day EMA, with the 100-day EMA widening from the 200-day EMA. The signals were bullish.

A hold above the 50-day EMA ($0.40550) would support a breakout from R1 ($0.4203) to target R2 ($0.4271) and $0.43. However, a fall through the 50-day EMA ($0.40550) would give the bears a run at S1 ($0.4017) and the 100-day EMA ($0.40028). A fall through the 50-day EMA would send a bearish signal.