XRP Price Return to $0.45 Hinged on SEC v Ripple Court Rulings

Key Insights:

• On Wednesday, XRP tracked the broader crypto market, rising by 2.26% to end the day at $0.41723.
• SEC v Ripple Court filings had a muted impact, with easing FTX and Genesis contagion risk supporting a bullish session.
• The technical indicators are bullish, with XRP sitting above the 50-day EMA, signaling a return to $0.45.

On Wednesday, XRP rose by 2.26%. Partially reversing a 3.92% slide from Tuesday, XRP ended the day at $0.41723. Despite the bullish session, XRP fell short of $0.43 for the first time in three sessions.

A bearish start to the day saw XRP fall to an early low of $0.3977. Finding support at the First Major Support Level (S1) at $0.3971, XRP rallied to a late high of $0.42398. However, coming up short of the First Major Resistance Level (R1) at $0.4250, XRP eased back to end the day at $0.41723.

Investment Banker Attempts to Shield Name from Public

The SEC v Ripple case was in the spotlight on Wednesday. Attorney James Filan shared an unexpected Court filing in response to a Ripple opposition filing.

“Investment Banker Declarant filed a response to Ripple’s opposition to the motion by Investment Banker Declarant to shield from public view his name, position, and employer.”

The lawyers argued,

“Had the Investment Banker Declarant declined to provide a statement, the SEC’s alternative was to compel his testimony to authenticate the document at issue. It is self-evident that where a witness’s only options are to provide a declaration or to testify, there is no truly voluntary ‘choice’ to be made.”

On January 18, Ripple filed an opposition to the Motion by “Investment Banker Declarant,” which sought to shield, from public view, his name, position, and employer because he voluntarily submitted the declaration in support of the SEC’s Summary Judgment motion.

The Defendants noted that neither party compelled the Declarant and his employer to provide the declaration, and neither party deposed them during discovery nor identified them as potential witnesses.

While the filing had no impact on XRP, it reflected the sensitivity of the case. However, a Court ruling on the William Hinman speech-related documents would have a material price impact. A ruling in favor of the Defendants could force the SEC down the settlement path and an XRP run at $0.50.

As background, former SEC Director of the Division of Corporation Finance William Hinman said that Bitcoin (BTC) and Ethereum (ETH) are not securities. The contentious issue with the speech related to Hinman’s connection with Simpson Thacher, which is part of a group that promotes Enterprise Ethereum. After leaving the SEC, Hinman returned to Simpson Thacher.

Mid-week, the broader crypto market provided price support. Subsiding FTX and Genesis contagion risk delivering a bullish session.

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. US economic indicators will draw interest today, with US GDP and jobless claims figures likely to influence. US corporate earnings have fueled recession fears. A sharp increase in jobless claims would test the appetite for riskier assets.

XRP Price Action

At the time of writing, XRP was down 0.59% to $0.41477. A bearish start to the day saw XRP fall from an early high of $0.41729 to a low of $0.41363.

Technical Indicators

XRP needs to avoid a fall through the $0.4130 pivot to target the First Major Resistance Level (R1) at $0.4282. A return to $0.42 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 $0.4393. The Third Major Resistance Level (R3) sits at $0.4655.

A fall through the pivot would bring the First Major Support Level (S1) at $0.4020 into play. However, barring an extended sell-off, XRP should avoid sub-$0.3950 and the Second Major Support Level (S2) at $0.3867. The Third Major Support Level (S3) sits at $0.3604.

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 $0.40496. 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 ($0.40496) would support a breakout from R1 ($0.4282) to target R2 ($0.4393) and $0.44. However, a fall through the 50-day EMA ($0.40496) would bring S1 ($0.4020) and the 100-day EMA ($0.39259) into view. A fall through the 50-day EMA would be a bearish signal.