XRP Rejoins the Crypto Market in the Red on SEC v Ripple Silence

Key Insights:

• On Thursday, XRP joined the broader crypto market in the red, falling by 4.57% to end the day at $0.37122.
• US President Joe Biden’s crypto tax plans, Fed Fear, and the collapse of Silvergate Bank overshadowed optimism toward the SEC v Ripple case.
• The technical indicators turned bearish, signaling a return to sub-$0.35.

On Thursday, XRP slid by 4.57%. Reversing a 2.33% gain from Wednesday, XRP ended the day at $0.37122. Significantly, XRP ended a three-day winning streak.

After a choppy morning, XRP rose to an early afternoon high of $0.39717 before hitting reverse. Coming up short of the First Major Resistance Level (R1) at $0.4026, XRP slid to a late Thursday low of $0.36443. XRP fell through the First Major Support Level (S1) at $0.3739 to wrap up the day at $0.37122.

SEC v Ripple Case Takes a Back Seat to Leave XRP in a Bearish Mood

There were no SEC v Ripple case updates to distract investors from the crypto news wires and the US economic calendar.

Market angst ahead of the US Jobs Report and Fed Fear weighed on buyer appetite. Following the news of Silvergate Bank planning a voluntary liquidation, SVB Financial Group (SIVB) shares plummeted as investors responded to the announcement of a $1.75 billion share sale to support its balance sheet and tackle the impact of falling deposits.

The US Administration added to the bearish mood, releasing a White House Fact Sheet that outlined plans to remove crypto tax subsidies.

For investors monitoring the SEC v Ripple case, a Court ruling on the Hinman Documents will be the key for the defendants and the broader crypto market. In a famous 2018 speech, William Hinman said that Bitcoin (BTC) and Ethereum (ETH) are not securities.

The contentious issue with the speech relates to Hinman’s connection with Simpson Thacher. Simpson Thacher is part of a group that promotes Enterprise Ethereum. After leaving the SEC, Hinman returned to Simpson Thacher.

A Court decision for the Defendants would fuel the expectation of an SEC settlement.

The Day Ahead

Investors should continue monitoring Binance, FTX, Silvergate Bank, and SIVB updates. Regulatory activity and lawmaker chatter will likely remain the focal point.

This afternoon, the US Jobs Report could spook investors. Another hotter-than-expected Jobs Report would send the NASDAQ Composite Index and the broader crypto market into the red.

However, we expect SEC v Ripple Court rulings to trump the US Job Report.

XRP Price Action

At the time of writing, XRP was down 0.19% to $0.37051. A bearish start to the day saw XRP fall from an early high of $0.37097 to a low of $0.36534.

Technical Indicators

XRP needs to move through the $0.3776 pivot to target the First Major Resistance Level (R1) at $0.3908 and the Thursday high of $0.39717. 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 $0.4103. The Third Major Resistance Level (R3) sits at $0.4431.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.3580 in play. However, barring an extended broad-based crypto sell-off, XRP should avoid sub-$0.35 and the Second Major Support Level (S2) at $0.3449. The Third Major Support Level (S3) sits at $0.3121.

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

At the time of writing, XRP sat below the 50-day EMA, currently at $0.37858. The 50-day EMA pulled back from the 100-day EMA, with the 100-day EMA easing back from the 200-day EMA. The signals were bearish.

A move through the 50-day EMA ($0.37858) would support a breakout from the 100-day ($0.37996) and 200-day ($0.38313) EMAs to target R1 ($0.3908). However, a fall through S1 ($0.3580) would give the bears a look at sub-$0.35.