XRP Run at $0.40 US Data Dependent Ahead of SEC v Ripple Court Rulings

Key Insights:

• On Tuesday, XRP joined the broader crypto market in the red, falling by 2.23% to end the day at $0.37858.
• Investor sentiment toward the SEC v Ripple case took a backseat, with US economic indicators and Fed chatter weighing.
• However, the technical indicators remain bullish, with XRP sitting at the 50-day EMA, signaling a return to $0.45.

On Wednesday, XRP slid by 2.23%. Reversing a 0.27% gain from Tuesday, XRP ended the day at $0.37858. The bearish session left XRP short of $0.40 for the second consecutive session.

Tracking the broader crypto market, XRP rose to an early afternoon high of $0.39603. Coming up short of the First Major Resistance Level (R1) at $0.3975, XRP slid to a late afternoon low of $0.36558. XRP fell through the First Major Support Level (S1) at $0.3781 and the Second Major Support Level (S2) at $0.3690 before a late partial recovery to end the day at $0.37858.

SEC v Ripple Court Filings Have Muted Impact on XRP

It was a busy Wednesday session, with Court filings in the ongoing SEC v Ripple case drawing interest.

On Wednesday, attorney James Filan shared the latest filings.

The SEC filed an opposition to Third Party A’s Motion to Redact all references to Third Party A as an entity and the proposed redactions by Third Party A (and Ripple) to the names of public trading platforms.

Ripple filed an opposition to the Motion by “Investment Banker Declarant,” which seeks 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.

However, the filings had a muted impact on investor sentiment, with investors awaiting several pivotal Court rulings, including the decision on the Hinman speech-related documents.

Having failed to shield the documents under the attorney-client privilege, SEC filed motions to redact content from the speech-related documents. A ruling against the SEC could force the SEC down the settlement road.

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.

XRP Joins the Broader Crypto Market in the Red as US Stats Flash Red

US economic indicators and FOMC member chatter weighed on XRP and the broader crypto market. A slide in retail sales and a larger-than-expected fall in industrial production fueled recession fears. The latest numbers raised the prospects of a hard landing.

FOMC member chatter contributed, however, with members Loretta Mester and James Bullard supporting rates beyond 5%.

CEO Brad Garlinghouse Gives His Spin on the SEC v Ripple Case

Ripple CEO Brad Garlinghouse was also in the news, talking at Davos.

Garlinghouse talked to CNBC, saying,

“Optimistic this will certainly be resolved in 2023 and maybe in the first half. We’ll see how it plays out from here, but I feel very good about where we are relative to the law and the facts.”

Garlinghouse responded to a question on whether he would wait for the judge to come out with a decision, saying,

“I’m very optimistic, and I think in the absence of some significant change in posturing from the SEC, I can’t imagine that we won’t have a resolution from the Judge.”

The Garlinghouse timelines gave US economic indicators and Fed chatter more influence on XRP price action.

Today, SEC v Ripple chatter will continue to draw interest, with US economic indicators and corporate earnings also in focus.

XRP Price Action

At the time of writing, XRP was down 0.32% to $0.37737. A mixed start to the day saw XRP rise to an early high of $0.38124 before falling to a low of $0.37737.

Technical Indicators

XRP needs to move through the $0.3801 pivot to target the First Major Resistance Level (R1) at $0.3945 and the Wednesday high of $0.39603. A return to $0.39 would signal a bullish session. However, the broader crypto market or SEC v Ripple updates would need to support a breakout.

In the case of an extended rally, XRP would likely test resistance at $0.40 but fall short of the Second Major Resistance Level (R2) at $0.4105. The Third Major Resistance Level (R3) sits at $0.4410.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.3641 in play. However, barring another extended sell-off, XRP should avoid sub-$0.35 and the Second Major Support Level (S2) at $0.3496. The Third Major Support Level (S3) sits at $0.3192.

Court rulings on the SEC v Ripple case would remove the influence of the Support and Resistance levels.

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

At the time of writing, XRP sat below the 50-day EMA, currently at $0.37991. The 50-day EMA widened from the 200-day EMA, with the 100-day EMA pulling away from the 200-day EMA. The signals were bullish.

A move through the 50-day EMA ($0.37991) would support a breakout from R1 ($0.3945) to target $0.40. However, a fall through the 100-day EMA ($0.37073) would give the bears a run at the 200-day EMA ($0.36715) and S1 ($0.3641). A pullback from the 50-day EMA would be a bearish signal.