XRP Eyes $0.75 to Target a Return to $0.80 on Relistings

Key Insights:

• On Friday, XRP slid by 11.97% to end the day at $0.7186.
• Concerns over the impact of the Court rulings on the Ripple business weighed as the Court grouped ODL and institutional clients in one basket.
• The nearer-term technical indicators turned bullish, bringing $0.80 back into view.

On Friday, XRP slid by 11.97%. Partially reversing a 73.35% surge from Thursday, XRP ended the day at $0.7186. Significantly, XRP slumped to sub-$0.70 before steadying.

XRP Price Action

At the time of writing, XRP was down 2.13% to $0.7033. A choppy start to the day saw XRP rise to an early high of $0.7231 before falling to a low of $0.6928.

Daily Chart

The Daily Chart showed XRP/USD sitting below the $0.7737 – $0.7870 resistance band. However, XRP sat well above the 50-day ($0.5114) and 200-day ($0.4663) EMAs, sending bullish near and longer-term price signals.

Notably, the 50-day EMA pulled away from the 200-day EMA and reflected bullish momentum over the near term.

Despite pull back from a Thursday high of $0.9337, XRP/USD avoided the upper level of the $0.6530 – $0.6417 support band, supporting a return to $0.80.

However, a fall through the upper level of the $0.6530 – $0.6417 support band could see XRP return to sub-$0.60.

Looking at the 14-Daily RSI, the 69.00 reading send bullish XRP price signals, aligned with the 50-day EMA and supporting a run at $0.80.

4-Hourly Chart

Looking at the 4-Hourly Chart, the XRP/USD faces strong resistance at the $0.8000 psychological level. XRP/USD sits below the $0.7737 – $0.7870 resistance band.

However, XRP sits above the 50-day ($0.5639) and 200-day ($0.5064) EMAs, sending bullish signals over the near and longer-term time horizons. Significantly, the 50-day EMA pulled away from the 200-day EMA, supporting a move through $0.75 to target the $0.7737 – $0.7870 resistance band.

The 14-4H RSI reading of 62.60 sends bullish XRP price signals and aligns with the 50-day EMA, with buying pressure outweighing selling pressure. Significantly, the RSI signals near-term bullish momentum, supporting a breakout from $0.75 to target the $0.7737 – $0.7870 resistance band.

SEC v Ripple Case Dust Settles and Sends XRP to Sub-$0.70 Levels

On Friday, investors considered Judge Torres’s ruling on the SEC v Ripple case in greater detail.

While ruling that XRP is not a security supported the breakout Thursday session, uncertainty surrounding the sale of XRP to institutional investors and XRP sales to ODL users led to the Friday pullback.

A ruling that ODL-related sales breach securities laws could impact US business. Ironically, Ripple would need to register with the SEC to continue offering the remittance business in the US that competes with traditional financial institutions.

Judge Torres grouped institutional investors with ODL users despite ODL users holding XRP for seconds and solely for remittance purposes. However, Ripple has been growing its business overseas because of the SEC v Ripple case, which should limit the impact of such a ruling on the Ripple business.

Ripple CTO David Schwartz had this to say,

“We’re still figuring this out. We don’t currently have ODL-related sales with a US nexus, and not being able to do so is not really a huge deal. We can still do ODL in the US, as long as XRP is never sourced from Ripple.”

Looking beyond Ripple, the Court ruling should force US lawmakers to react to the Court ruling and SEC Chair Gary Genslar’s sweeping statements that all cryptos (except BTC) are securities.

Ripple CEO Brad Garlinghouse called on Congress to react, saying,

“Hoping yesterday’s decision is the wake-up call that Congress needs. This ruling directly undercuts the SEC’s claims that nearly all tokens are inherently securities – likely to set a positive precedent for other digital tokens in the US.”

The Day Ahead

We expect the SEC v Ripple Court ruling to remain the focal point this weekend. While the implications of the Court rulings are favorable for the broader crypto market, there is the threat of the SEC appealing the decision considering the Court ruled against Ripple vis-à-vis institutional sales.

However, US lawmakers could deliver support. A call from both sides of the Aisle to review the SEC’s role in regulating the digital asset space would be a step in the right direction.

SEC Chair Gary Gensler’s Twitter account has remained silent about the Court rulings. An end to regulation by enforcement would be a start for the US crypto market.