XRP Needs a Favorable SEC v Ripple Court Ruling to Breakout From $0.42

Updated: Jan 30, 2023, 07:06 UTC•3min read

Following a bullish Sunday, XRP found early support this morning. However, a lack of SEC v Ripple rulings would leave the broader market to influence.

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Key Insights:

On Sunday, XRP rose by 1.35% to end the day at $0.41348.
Investor sentiment toward Fed monetary policy and easing contagion risk supported a bullish session.
The technical indicators remain bullish, with XRP sitting above the 50-day EMA, signaling a return to $0.45.

On Sunday, XRP rose by 1.35%. Reversing a 1.11% loss from Saturday, XRP ended the week up 3.17% to $0.41348. XRP avoided sub-$0.40 levels for the fifth time in seven sessions.

A mixed start to the day saw XRP fall to an early low of $0.40692. Steering clear of the First Major Support Level (S1) at $0.4143, XRP rallied to a late high of $0.41722. XRP broke through the First Major Resistance Level (R1) at $0.4143 before easing back to end the day at $0.41348.

Fed Bets and Easing Contagion Risk Deliver an XRP Recovery

There were no updates from the ongoing SEC v Ripple case to provide direction on Sunday. The lack of updates left XRP in the hands of the broader crypto market and the crypto news wires.

Investors moved on from the increased crypto market scrutiny from the White House Administration, returning focus to the Fed and the Wednesday interest rate decision.

The softer inflation numbers from Friday and a further decline in personal spending supported the bets of a 25-basis point interest rate hike on Wednesday. With cracks showing in the US economy, the markets are also expecting a less aggressive interest rate trajectory to bring inflation to target, raising hopes of a soft landing.

Easing FTX and Genesis contagion continued to deliver price support.

Today, investors should monitor updates from the SEC v Ripple case. However, a lack of updates would leave the broader crypto market to provide direction. FTX and Genesis updates, along with regulatory chatter, will draw interest.

With the Fed delivering its first interest rate decision of 2023 on Wednesday, the NASDAQ Index will likely provide direction in the afternoon session.

XRP Price Action

At the time of writing, XRP was up 0.63% to $0.41610. A mixed start to the day saw XRP fall to an early low of $0.41257 before rising to a high of $0.41610.

XRPUSD 300123 Daily Chart

Technical Indicators

XRP needs to avoid a fall through the $0.4125 pivot to target the First Major Resistance Level (R1) at $0.4182. A move through the Sunday high of $0.41722 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 another extended rally, XRP would likely test the Second Major Resistance Level (R2) at $0.4228 and resistance at $0.4250. The Third Major Resistance Level (R3) sits at $0.4331.

A fall through the pivot would bring the First Major Support Level (S1) at $0.4079 into play. However, barring a crypto event-fueled sell-off, XRP should avoid sub-$0.4050 and the Second Major Support Level (S2) at $0.4022. The Third Major Support Level (S3) sits at $0.3919.

XRP resistance levels in play above the pivot.

XRPUSD 300123 Hourly Chart

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 $0.40858. The 50-day EMA pulled 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 ($0.40858) would support a breakout from R1 ($0.4182) to target R2 ($0.4228) and $0.4250. However, a fall through the 50-day EMA ($0.40858) and S1 ($0.4079) would bring S2 ($0.4022) into view. A fall through the 50-day EMA would send a bearish signal.