XRP Set for a Choppy Session as SEC v Ripple Case Takes Center Stage

Key Insights:

• On Tuesday, XRP rose by 0.27% to end the day at $0.38720, the upside coming despite the broader crypto market seeing red.
• Investor optimism toward a favorable outcome to the SEC v Ripple case delivered support.
• The technical indicators are bullish, with XRP sitting above the 50-day EMA, signaling a return to $0.45.

On Tuesday, XRP rose by 0.27%. Following a 0.34% gain on Monday, XRP ended the day at $0.38720. Despite the bullish session, XRP came up short of $0.40 for the second time in four sessions.

A bearish start to the day saw XRP fall to an early low of $0.37937 before making a move. Steering clear of the First Major Support Level (S1) at $0.3734, XRP rallied to a late high of $0.39878. However, coming up short of the First Major Resistance Level (R1) at $0.4025, XRP eased back to end the day at $0.38720.

XRP Bucked the Broader Market Trend on SEC v Ripple Optimism

It was another quiet session on Tuesday, with no SEC v Ripple case updates to provide direction. However, investor optimism toward the outcome continued to deliver support.

On Tuesday, Amicus Curiae attorney John Deaton drew attention, talking about the likely influences of the Amicus briefs on the SEC bid to classify XRP as a security. Deaton shared a section of his filing, saying,

“The SEC literally claims XRP itself was, is, and always will be a security.”

Adding,

“The scope of the SEC’s Howey argument has become so stretched that it is truly indefinable, in space or in time.”

While John Deaton shared his thoughts, investors await several Court rulings that could materially impact XRP and the broader crypto market.

One ruling relates to the all-important William Hinman speech-related documents. Having failed to shield the documents under the attorney-client privilege, the 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.

Today, all parties and non-parties must file oppositions to the non-party Motions to Seal. Once the parties have filed, rulings on the previously filed motions could come at any time, which may test investor appetite.

However, a lack of updates would leave XRP in the hands of the broader crypto market. US economic indicators will draw interest in the afternoon session.

XRP Price Action

At the time of writing, XRP was down 0.29% to $0.38608. A mixed start to the day saw XRP rise to an early high of $0.38943 before falling to a low of $0.38528.

Technical Indicators

XRP needs to move through the $0.3885 pivot to target the First Major Resistance Level (R1) at $0.3975 and the Tuesday high of $0.39878. A return to $0.3950 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 the Second Major Resistance Level (R2) at $0.4079. The Third Major Resistance Level (R3) sits at $0.4273.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.3781 in play. However, barring an extended sell-off, XRP should avoid sub-$0.37 and the Second Major Support Level (S2) at $0.3690. The Third Major Support Level (S3) sits at $0.3496.

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 above the 50-day EMA, currently at $0.37872. 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 hold above the 50-day EMA ($0.37872) would support a breakout from R1 ($0.3975) to target R2 ($0.4079). However, a fall through the 50-day EMA ($0.37872) would signal a shift in investor sentiment and bring the Major Support Levels into play.