XRP Eyes Sub-$0.35 as Contagion Risk Overshadows SEC v Ripple Case

Key Insights:

• On Friday, XRP fell for the sixth session from seven, ending the day at $0.38356.
• Hopes of an FTX bailout took a back seat, with news of FTX.US filing for bankruptcy and BlockFi suspending withdrawals weighing.
• The technical indicators are bearish, with XRP sitting below the t0-day EMA, signaling a return to sub-$0.35.

On Friday, XRP fell by 2.77%. Partially reversing an 18.59% rally from Thursday, XRP ended the day at $0.38356. Notably, XRP ended the day at sub-$0.40 for the third consecutive session.

A mixed start to the day saw XRP rise to an early high of $0.39777. Coming up short of the First Major Resistance Level (R1) at $0.4206, XRP fell to an early afternoon low of $0.36556. However, steering clear of the First Major Support Level (S1) at $0.3493, XRP found late support to wrap up the day at $0.38356.

SEC v Ripple case updates failed to provide XRP price support despite the final batch of Amicus Briefs.

The market focus remained on FTX, progress toward a bailout, and contagion risk.

Amicus Brief Filings End on Another Tumultuous Day in the Markets

On Friday, Amicus Brief filings continued to roll in at the eleventh hour, with the Court setting a November 11 deadline at the request of the SEC.

Cryptillian Payment Systems, XRP the Standard Productions, and Paradigm Operations filed Amicus Briefs before the November 11 deadline.

With the Amicus Brief filings complete, the SEC and the defendants have until November 30 to prepare and submit Summary Judgment Reply Briefs before availing redacted versions to the public on December 5.

Arguments for and against the Amicus Briefs and the Court’s position on the briefs will draw plenty of interest. The Amicus Briefs offered numerous examples of XRP as a utility.

Following the collapse of FTX, the SEC will likely take advantage of the situation to justify its enforcement practices. US lawmaker, Republican Tom Emmer, targeted the SEC Chair, saying,

“Interesting. Gary Gensler runs to the media while reports to my office allege he was helping SBF and FTX work on legal loopholes to obtain a regulatory monopoly. We’re looking into this.”

XRP Price Action

At the time of writing, XRP was down 2.73% to $0.37309. A bearish start to the day saw XRP fall from an early high of $0.38333 to a low of $0.37309.

Technical Indicators

XRP needs to move through the $0.3823 pivot to target the First Major Resistance Level (R1) at $0.3990. A move through the Friday high of $0.39777 would signal a bullish session, though FTX bailout and contagion news updates will have to be crypto-friendly.

In the case of an extended rally, the bulls would take a run at the Second Major Resistance Level (R2) at $0.4145 and $0.42. The Third Major Resistance Level (R3) sits at $0.4467.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.3668 in play. However, barring another extended sell-off, XRP should avoid sub-$0.35. The Second Major Support Level (S2) at $0.3501 should limit the downside. The Third Major Support Level (S3) sits at $0.3179.

Throughout the session, FTX news updates will remain the key driver, with any negative news linked to the FTX collapse likely to deliver an extended sell-off.

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

At the time of writing, XRP sat below the 50-day EMA, currently at $0.41651. The 50-day EMA slid back from the 100-day EMA, with the 100-day EMA falling back from the 200-day EMA. The signals were bearish.

A move through R1 ($0.3990) would bring R2 ($0.4145) and the 50-day EMA ($0.41651) into play. However, failure to move through R1 and the 50-day EMA would leave S1 ($0.3668) in view.