XRP Bulls to target $0.3900 or Face a Slide to Sub-$0.3800 on Fed Fear

Key Insights:

• On Saturday, XRP fell by 0.61%, marking the third loss from four sessions.
• A lack of SEC v Ripple news left XRP on the back foot as investor focus turned to Tuesday’s US CPI report and the Fed.
• The technical indicators turned bearish, with XRP below the 50-day EMA, signaling a possible return to $0.35.

On Saturday, XRP fell by 0.61%. Following a 1.41% loss on Friday, XRP ended the day at $0.38650. Notably, XRP fell short of $0.39 for the first time in seventeen sessions.

A bearish morning saw XRP fall to a mid-morning low of $0.38557. Steering clear of the First Major Support Level (S1) at $0.3841, XRP rose to a late afternoon high of $0.38905. However, coming up short of the First Major Resistance Level (R1) at $0.3943, XRP slid back to sub-$0.3860 before ending the day at $0.38650.

Fed Fear and SEC v Ripple Uncertainty Leaves XRP at Sub-$0.39

It was a quiet Saturday session. Following Friday’s US wholesale inflation numbers, uncertainty toward Wednesday’s FOMC interest rate decision and economic projections left XRP in a tight range. On Tuesday, the US CPI report will likely dictate the Fed’s next move, with the markets betting on a Fed pivot.

However, an unexpected spike in US inflation could force the Fed to deliver another 75-basis point rate hike that would send XRP and the broader crypto market into the red.

Increased uncertainty about the outcome of the ongoing SEC v Ripple case added to the bearish mood. Investor optimism has subsided since the collapse of FTX. The markets now await the Court ruling on the Summary Judgment Reply briefs, which could have far-reaching implications for the broader crypto market.

Today, a lack of updates from the SEC v Ripple case will likely leave XRP in the hands of the broader crypto market and the NASDAQ mini.

XRP Price Action

At the time of writing, XRP was up 0.48% to $0.38834. A mixed start to the day saw XRP fall to an early low of $0.38635 before rising to a high of $0.38857.

The First Major Resistance Level (R1) at $).3885 capped the upside.

Technical Indicators

XRP needs to avoid the $0.3870 pivot to retarget the First Major Resistance Level (R1) at $0.3885 and the Saturday high of $0.38905. A return to $0.3890 would signal a bullish session.

In the case of an extended rally, the bulls would take a run at the Second Major Resistance Level (R2) at $0.3905. A return to $0.39 would bring the Third Major Resistance Level (R3) at $0.3940 into play.

A fall through the pivot would give the bears a run at the First Major Support Level (S1) at $0.3850. However, barring an extended sell-off, XRP should avoid sub-$0.38. The Second Major Support Level (S2) at $0.3836 and the Third Major Support Level (S3) at $0.3801 should limit the downside.

The EMAs and the 4-hourly candlestick chart (below) sent a bearish signal.

At the time of writing, XRP sat below the 50-day EMA, currently at $0.38870. The 50-day EMA slipped back from the 100-day EMA, with the 100-day EMA easing back from the 200-day EMA. The signals were bearish.

A move through the 50-day ($0.38870) and R1 ($0.3885) would give the bulls a run at the 100-day EMA ($0.38991) and R2 ($0.3905). However, failure to move through the 50-day ($0.38870) would bring S1 ($0.3850) into play.