XRP Bulls Eye a Return to $0.40 on SEC v Ripple Fair Notice Defence

Key Insights:

• On Monday, XRP slid by 3.26% to end the day at $0.37399.
• XRP and the broader crypto market succumbed to profit-taking as investors responded to easing banking sector risks.
• However, the technical indicators remained bullish, signaling a return to $0.42.

On Monday, XRP slid by 3.26%. Reversing a 3.24% gain from Sunday, XRP ended the day at $0.37399. Despite the bearish session, XRP avoided sub-$0.37 for the third consecutive day.

A mixed start to the day saw XRP rise to an early high of $0.39206 before hitting reverse. Falling short of the First Major Resistance Level (R1) at $0.4005, XRP slid to an early evening low of $0.37200. XRP briefly fell through the First Major Support Level (S1) at $0.3733 before ending the day at $0.37399.

XRP Tracks BTC into the Red But Finds Morning Support

It was a busier Sunday, with updates from the ongoing SEC v Ripple case drawing investor interest. While investors await rulings on the Hinman Documents and the Summary Judgment Reply Briefs, the Ripple Defendants made a new filing in support of their fair notice defense.

Overnight, defense attorney James Filan shared the filing, saying,

“Ripple Defendants file Letter Notice of Supplemental Authority in further support of their fair notice defense. It’s the decision of Judge Michael Wiles in the Voyager bankruptcy case where Judge Wiles rejected the SEC’s objections and approved the bankruptcy plan.”

The filing referenced rulings on SEC objections in the Voyager Digital Holdings bankruptcy case.

According to the filing, SEC objected to the plan for Voyager to sell its assets, including VGX, to Binance.US, which the SEC also objected to, stating that Binance.US is an unregistered securities exchange. The letter to Judge Torres noted that the basis for Judge Wiles rejecting the SEC objections endorsed many of the arguments the Defendants have presented in the filing.

In reference to the regulatory landscape, the filing noted that,

“Judge Wiles found that cryptocurrency market participants operate in a regulatory environment that at best can be described as highly uncertain, in which regulators themselves cannot seem to agree as to whether cryptocurrencies are commodities that may be subject to regulation by the CFTC or whether they are securities that are subject to securities laws, or neither, or even on what criteria should be applied in making the decision.”

Judge Wiles went on to say,

“An uncertainty has persisted despite the fact that cryptocurrency exchanges have been around for a number of years.”

While the filing had a limited impact on XRP, the argument presents Judge Torres with further reason to shift in favor of the Defendants.

The Day Ahead

Central bank commentary will likely be an area of focus today. Following the UBS acquisition of the Credit Suisse Group, central bankers will be in the spotlight ahead of the Fed monetary policy decision.

However, investors should continue to monitor the crypto news wires. Regulator and lawmaker chatter will influence, along with Binance and FTX updates. Nonetheless, rulings from the ongoing SEC v Ripple case would have more influence on investor sentiment.

XRP Price Action

At the time of writing, XRP was up 2.37% to $0.38284. A mixed start to the day saw XRP fall to an early low of $0.37325 before rising to a high of $0.38400.

Technical Indicators

XRP needs to avoid the $0.3794 pivot to target the First Major Resistance Level (R1) at $0.3867 and the Monday high of $0.39206. A return to $0.39 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 an extended rally, XRP would likely test the Second Major Resistance Level (R2) at $0.3994 and resistance at $0.40. The Third Major Resistance Level (R3) sits at $0.4195.

A fall through the pivot would bring the First Major Support Level (S1) at $0.3666 into play. However, barring an extended broad-based crypto sell-off, XRP should avoid sub-$0.3650 and the Second Major Support Level (S2) at $0.3593. The Third Major Support Level (S3) sits at $0.3392.

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

At the time of writing, XRP sat above the 200-day EMA, currently at $0.37865. The 50-day EMA closed in on the 200-day EMA, with the 100-day EMA narrowing to the 200-day EMA. The EMAs delivered bullish signals.

A hold above the 200-day EMA ($0.37865) would support a breakout from R1 ($0.3867) to target R2 ($0.3994) and $0.40. However, a fall through the 200-day ($0.37865) would bring the 50-day ($0.37710) and 100-day ($0.37629) EMAs and S1 ($0.3666) into play. A fall through the 50-day EMA would send a bearish signal.