XRP Bulls to Target $0.42 as Investors Digest the SEC v Ripple Filings

Key Insights:

• On Friday, XRP rose by 2.86% to extend its winning streak to six sessions.
• Investor sentiment toward the SEC v Ripple case delivered support alongside the broader crypto market.
• The technical indicators are bullish, with XRP sitting above the 50-day EMA, signaling a return to $0.45.

On Friday, XRP rose by 2.86%. Following a 0.57% gain on Thursday, XRP ended the day at $0.38576. Significantly, XRP ended the day at $0.38 for the first time since December 14 and extended the winning streak to six sessions.

After a range-bound morning, XRP fell to an early afternoon low of $0.36825. Steering clear of the First Major Support Level (S1) at $0.3630, XRP rallied to a late high of $0.3866. XRP broke through the First Major Resistance Level (R1) at $0.3841 to end the day at $0.38576.

Investor Sentiment Toward FTX Delivers $0.38

It was a busy Friday session for XRP investors. Through the afternoon session, the US economic and corporate calendars supported the broader crypto market.

A pickup in consumer sentiment and easing consumer inflation expectations supported the bets of a 25-basis point Fed interest rate hike in February and a soft landing. Bank earnings were also crypto-market friendly.

Easing FTX contagion fear remained the key driver, however. There were also updates from the ongoing SEC v Ripple case for investors to consider.

SEC v Ripple Activity Picks Up on Friday with Court Filings to Digest

Overnight, defense attorney James Filan shared the latest filings from the parties.

The Defendants filed a redacted Motion to Exclude the Testimony of SEC Expert 2 and the accompanying exhibits on the public docket.

On Friday, the SEC filed a Motion to Preclude the Testimony of the Ripple Defendants’ Expert. According to the filing,

“Facing decades of case law that supports the SEC’s claims, Defendants seek to distract and inundate this Court with a parade of experts offering a host of opinions that have nothing to do with Howey’s three prongs or are otherwise improper.”

The latest filings join a growing list of rulings that the Court needs to deliver on, including the SEC’s attempts to shield certain content of the William Hinman speech-related documents from the public arena.

The William Hinman speech-related documents remain the center of attention. A ruling against the SEC to redact selected sections of the speech-related documents could force the SEC into a settlement.

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, there are unlikely to be any Court rulings to provide direction, leaving investors to consider the latest filings and the pending Court rulings. Next week, all parties and non-parties must file oppositions to the non-party Motions to Seal, which will then leave the matter in the hands of the Court.

Sentiment toward the case remains positive, supporting the XRP return to $0.40 this morning.

XRP Price Action

At the time of writing, XRP was up 4.59% to $0.40348. A bullish start to the weekend saw XRP rally from an early low of $0.38527 to a high of $0.40574.

XRP broke through the First Major Resistance Level (R1) at $0.3922 and the Second Major Resistance Level (R2) at $0.3986.

Technical Indicators

XRP needs to avoid a fall through R2, R1, and the $0.3802 pivot to target the Third Major Resistance Level (R3) at $0.4169. A move through the morning high of $0.40574 would signal an extended bullish session.

In the case of an extended rally, XRP could test resistance at $0.42 before any pullback. Before the collapse of FTX, XRP had struck an early November high of $0.50999 before stumbling to a post-FTX collapse low of $0.30098.

The bulls will be looking for a near-term return to $0.50, supported by easing FTX contagion and hopes of a favorable outcome to the SEC v Ripple case.

A fall through Major Resistance Levels and the pivot would bring the First Major Support Level (S1) at $0.3738 into play. However, barring an extended sell-off, XRP should avoid sub-$0.37 and the Second Major Support Level (S2) at $0.3619. The Third Major Support Level (S3) sits at $0.3435.

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 $0.36158. After the Friday bullish cross, the 50-day EMA pulled away from the 200-day EMA, with the 100-day EMA narrowing to the 200-day EMA. The signals were bullish.

Avoiding S1 ($0.3738) would support a breakout from the morning high of $0.40575 to target R3 ($0.4169) and $0.42. However, a reversal of the morning gains and a fall through S1 ($0.3738) would bring S2 ($0.3619) and the 50-day ($0.36158) into view. A fall through the 50-day EMA would be a bearish signal.