XRP Price Action Points to a Likely SEC Appeal in the SEC v Ripple Case

Key Insights:

• On Friday, XRP gave up some of Thursday’s breakout session, falling by 1.42% to end the quarter at $0.4801.
• While tracking the broader market, expectations of an SEC appeal to the Hinman Court ruling added to the bearish sentiment.
• However, the technical indicators are bullish, with XRP sitting above the 50-day EMA, supporting a return to $0.55.

On Friday, XRP fell by 1.42%. Partially reversing an 8.49% from Thursday, XRP ended the third quarter up by 44.6% to $0.4801, supported by a 46.7% September gain.

After a relatively bullish start to the Friday session, XRP slid to a mid-day low of $0.46496. However, steering clear of the First Major Support Level (S1) at $0.4388, XRP rallied to a high of $0.49943. Coming up short of the First Major Resistance Level (R1) at $0.5223, XRP fell back to sub-$0.48 before steadying.

XRP tracked the broader crypto market into negative territory, with US inflation and fed fear weighing. However, fears of a likely SEC appeal to Thursday’s Court ruling on the Hinman docs added further price pressure.

The Hinman Doc Court Ruling Removes Hope of an Early Conclusion

Last week, hopes of a swift conclusion to the SEC v Ripple case supported an XRP return to $0.55 before hitting reverse.

On Thursday, Judge Torres overruled the SEC’s objection to the Court denying the SEC motion to protect the William Hinman speech-related documents under the attorney-client privilege.

The latest Court ruling likely erased hope of an early conclusion to the SEC v Ripple case that has dragged on since December 2020.

To date, SEC has failed to turn over the Hinman speech-related documents despite numerous Court orders. The SEC has battled to shield the Hinman documents under the attorney-client privilege, with more than seven motions contesting previous Court decisions. The consensus is that the SEC may even prefer to settle than disclose the content of the documents.

The former SEC Director of the Division of Corporation Finance, William Hinman, has been a central figure in the SEC v Ripple case. In a famous 2018 speech, Hinman said that Bitcoin (BTC) and Ethereum (ETH) are not securities.

The SEC has more to lose than just the case against Ripple. SEC Chair Gary Gensler is bidding to win the right to regulate the digital asset space. Currently, the SEC is in a battle with the Commodity Futures Trading Commission (CFTC) for the honor.

Thursday’s ruling was another blow for Gensler and the SEC. The next steps for the SEC will likely include delaying the disclosure of the documents. In a series of tweets, defense attorney James Filan shared his thoughts on the SEC’s options. These included,

• Ask Judge Torres to reconsider her overruling the SEC objection.
• Request the Court to certify an appeal of the Court decision.
• Go to the Court of Appeals on a Petition for Writ of Mandamus.
• All the above.

While the above maneuvers will not impact the summary of judgment schedule, they could give the SEC a few months of breathing space before producing the docs. The likely delay may add some uncertainty to the outcome of the case. However, the Court rulings continue to go Ripple’s way, which are XRP price positives.

XRP Price Action

At the time of writing, XRP was down 1.27% to $0.47401. A mixed start to the day saw XRP rise to an early high of $0.48116 before falling to a low of $0.47287.

Technical Indicators

XRP needs to move through the $0.4815 pivot to target the First Major Resistance Level (R1) at $0.4980 and the Friday high of $0.49943. Investors will look out for any updates from the SEC and the Defendants. Talk of an SEC appeal would likely limit the upside.

However, in the case of an extended rally, the bulls would take a run at the Second Major Resistance Level (R2) at $0.5160. The Third Major Resistance Level (R3) sits at $0.5504.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.4636 in play. Barring an extended sell-off, XRP should steer clear of sub-$0.45 and the Second Major Support Level (S2) at $0.4470.

The Third Major Support Level (S3) sits at $0.4126.

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 $0.45619. The 50-day EMA pulled away from the 100-day EMA, with the 100-day EMA widening from the 200-day EMA. The signals were XRP price positive.

An XRP hold above the 50-day EMA ($0.45619) would support a breakout from R1 ($0.4980) to target R2 ($0.5160). However, a fall through the 50-day EMA ($0.45619) would give the bears a run at S1 ($0.4636) and the 100-day EMA ($0.43209). The 200-day EMA sits at $0.40246.