XRP Bulls to Target $0.49 on Fed Chatter and John Deaton Comments

Key Insights:

• On Monday, XRP enjoyed a breakout session, gaining 2.14% to end the day at $.4783.
• While there were no SEC v Ripple case-related updates to consider, Fed chatter provided support.
• The nearer-term technical indicators turned bullish, bringing $0.50 into view.

On Monday, XRP gained 2.14%. Reversing a 0.47% loss from Tuesday, XRP ended the day at $0.4783. Significantly, XRP revisited the $0.48 handle for the first time in four sessions.

XRP Price Action

At the time of writing, XRP was down 0.59% to $0.4755. A bearish start to the day saw XRP fall from an early high of $0.4784 to a low of $0.4753.

Daily Chart

The Daily Chart showed XRP/USD sitting below the 50-day EMA ($0.4821) while holding above the 200-day EMA ($0.4577), sending near-term bearish but bullish longer-term signals.

Notably, the 50-day EMA narrowed to the 200-day EMA and reflected bearish momentum over the near term.

On Monday, XRP/USD bounced back from the lower level of the $0.4675 – $0.4615 support band to bring the 50-day EMA ($0.4821) into view. A move through the 50-day EMA would give the bulls a run at the lower level of the $0.4925 – $0.5000 resistance band.

However, failure to move through the 50-day EMA would leave the $0.4675 – $0.4615 support band and the 200-day EMA ($0.4577) in view.

Looking at the 14-Daily RSI, the 47.06 reading signaled a moderately bearish trend, aligned with the 50-day EMA and supporting a fall through the $0.4675 – $0.4615 support band to test the 200-day EMA ($0.4577).

4-Hourly Chart

Looking at the 4-Hourly Chart, the XRP/USD faces strong resistance at the $0.48 psychological level. XRP/USD sits above the 50-day EMA ($0.4740), while sitting below the 200-day EMA ($0.4822). Significantly, the 50-day EMA narrowed to the 200-day EMA, signaling a move through the 200-day EMA ($0.4822) to target the lower level of the $0.4925 – $0.5000 resistance band.

However, a fall through the 50-day EMA ($0.4740) would bring the $0.4675 – $0.4615 support band into play.

The 14-4H RSI reading of 57.11 indicates a bullish stance and aligns with the 50-day EMA, with buying pressure outweighing selling pressure. Significantly, the RSI signals near-term bullish momentum and a look at the 200-day EMA and the resistance band.

Fed Commentary Delivered a Breakout Session

It was a quiet Monday session. There were no Court rulings from the ongoing SEC v Ripple case to move the dial. The lack of Court rulings left XPP in the hands of the Fed and the broader crypto market.

Fed Fear eased at the start of the week, with several FOMC members signaling the near-term end to the Fed monetary policy tightening cycle.

FOMC Member Mary Daly reportedly favored two further rate hikes this year but added,

“While the risks of doing too little are still greater than those of overdoing it on rate hikes, the two sides are getting into better balance as the Fed nears the last part of its hiking cycle.”

FOMC member Michael Barr noted that he thinks the Fed is close, with Raphael Bostic erring on the side of patience.

According to the CME FedWatch Tool, the probability of a 25-basis point July Fed rate hike was 92.4% versus 93.0% on Friday. Significantly, the chances of the Fed lifting rates to 5.75% in September stood at 23.1%, down from 24.2% on Friday.

While there were no SEC v Ripple updates to consider, Amicus Curiae attorney John Deaton commented on the length of time to deliver a Court ruling. Deaton had this to say,

“The Ripple v SEC Reply Briefs were filed in December. Thus, Judge Torres’ decision is now at seven months. Ripple isn’t the only one waiting, however. In the Thor Equities case, also before Judge Torres, the Reply Briefs were also filed in December. Judge Torres hasn’t yet ruled.”

Deaton provided several cases as examples, including the NY District Carpenter’s fund case in which Judge Torres took eight months to deliver a summary judgment ruling.

Deaton concluded,

“In short, although I, and others, believe that we would see a ruling before now, there are other cases and examples that have taken an equal amount of time. Judge Torres is likely aware of the magnitude of her decision.”

The Day Ahead

It is a quiet Tuesday session, with no US economic indicators to influence. The lack of US economic indicators will continue to leave Fed chatter to draw interest. Hawkish commentary could test buyer appetite, with FOMC Member Bullard on the calendar to speak today.

While Fed chatter will influence, the SEC v Ripple case will remain the focal point. Beyond the SEC v Ripple case, investors should monitor SEC and US lawmaker chatter. Binance, SEC v Binance, and Coinbase (COIN)-related news also needs consideration.