XRP Eyes a $0.48 on Easing Default Fear and SEC v Ripple Hopes

Bob Mason
Published: May 27, 2023, 02:33 GMT+00:00

XRP fell into the red this morning. However, optimism toward the SEC v Ripple case and the easing risk of a US default should limit the effects of Fed Fear.

XRP Technical Analysis - FX Empire

In this article:

Key Insights:

  • On Friday, XRP rallied 3.32% to end the day at $0.46877.
  • Ripple CEO Brad Garlinghouse’s comments resonated, with progress toward a US debt ceiling deal providing support.
  • The technical indicators turned bullish, signaling a return to $0.48.

On Friday, XRP rallied by 3.32%. Following a 0.13% gain on Thursday, XRP ended the day at $0.46877. Despite the bullish session, XRP fell short of the $0.47 handle for the fifth consecutive session.

Bullish throughout the day, XRP rallied from an early morning low of $0.45276 to a late session high of $0.46972. XRP broke through the First Major Resistance Level (R1) at $0.4576 and the Second Major Resistance Level (R2) at $0.4614 to end the day at $0.46877.

US Debt Ceiling Updates and Brad Garlinghouse Delivered Support

It was a quiet Friday. There were no Court rulings from the ongoing SEC v Ripple case to provide direction. The lack of updates left Ripple CEO Brad Garlinghouse’s comments from earlier in the week to resonate.

The Ripple CEO announced a likely Court ruling in weeks rather than months. Garlinghouse referenced the recent Judge Torres ruling on the Willian Hinman speech-related documents set for disclosure on June 13 and discussed the Ripple business and the US regulatory landscape.

US economic indicators and progress toward a US debt ceiling deal also provided support. While US inflation picked up in April, personal spending and core durable goods orders painted a rosier picture of the US economy. Reports of US policymakers nearing a deal to raise the debt ceiling limited the increased chance of a June interest rate hike.

The Day Ahead

It is a quiet Saturday session, with no material SEC v Ripple updates likely to influence. The quiet session should leave investors to grapple with the increasing probability of a June interest rate hike and the easing threat of a US default.

While updates from Washington will provide direction, investors should also track SEC v Ripple chatter and Binance and Coinbase (COIN)-related news. Binance and Coinbase remain under the scrutiny of US lawmakers, with the legal case against both entities likely to draw interest in the months ahead.

XRP Price Action

At the time of writing, XRP was down 0.32% to $0.46727. A bearish start to the day saw XRP fall from an opening price of $0.46878 to a low of $0.46662.

XRP sees early red.
XRPUSD 270523 Daily Chart

XRP Technical Indicators

Resistance & Support Levels

R1 – $ 0.4747 S1 – $ 0.4578
R2 – $ 0.4807 S2 – $ 0.4468
R3 – $ 0.4977 S3 – $ 0.4298

XRP needs to avoid the $0.4638 pivot to target the First Major Resistance Level (R1) at $0.4747. A move through the Friday high of $0.46972 would signal an extended breakout session. However, SEC v Ripple chatter and US debt ceiling-related news must support a breakout session.

In the case of an extended rally, XRP would likely test the Second Major Resistance Level (R2) at $0.4807. The Third Major Resistance Level (R3) sits at $0.4977.

A fall through the pivot would bring the First Major Support Level (S1) at $0.4578 into play. However, barring a crypto event or risk-off-fueled sell-off, XRP should avoid sub-$0.45 and the Second Major Support Level (S2) at $0.4468. The Third Major Support Level (S3) sits at $0.4298.

XRP resistance levels in play above the pivot.
XRPUSD 270523 Hourly Chart

The EMAs and the 4-hourly candlestick chart (below) sent bullish signals.

At the time of writing, XRP sat above the 50-day EMA, currently at $0.45722. The 50-day EMA pulled away from the 200-day EMA, with the 100-day EMA narrowing to the 200-day EMA. The EMAs delivered bullish signals.

A hold above S1 ($0.4578) and the 50-day EMA ($0.45722) would support a breakout from R1 ($0.4747) to target R2 ($0.4807). However, a fall through S1 ($0.4578) and the 50-day EMA ($0.45722) would bring the 200-day ($0.45586) and 100-day ($0.45406) EMAs and S2 ($0.4469) into view. A fall through the 50-day EMA ($0.45722) would send a bearish signal.

EMAs are bullish.
XRPUSD 270523 4 Hourly Chart

About the Author

Bob Masonauthor

With over 20 years of experience in the finance industry, Bob has been managing regional teams across Europe and Asia and focusing on analytics across both corporate and financial institutions. Currently he is covering developments relating to the financial markets, including currencies, commodities, alternative asset classes, and global equities.

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