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Key Insights:
- On Monday, XRP joined a broad-based crypto sell-off, falling 4.86% to end the day at $0.7026.
- Uncertainty over SEC plans to appeal the SEC v Ripple Court continued to weigh on investor sentiment.
- The shorter-term technical indicators are bearish, supporting a return to sub-$0.65.
On Monday, XRP slid by 4.86%. Reversing a 0.74% gain from Sunday, XRP ended the day at $0.7026. XRP visited sub-$0.70 for the first time since July 15.
XRP Price Action
This morning, XRP was down 0.85% to $0.6966. A bearish start to the day saw XRP fall from an early high of $0.7032 to a low of $0.6948.
Daily Chart
The Daily Chart showed XRP/USD remained below the $0.7870 – $0.7737 resistance band, with XRP under selling pressure. However, XRP sat well above the 50-day ($0.5902) and 200-day ($0.4936) EMAs, sending bullish near and longer-term price signals.
Notably, the 50-day EMA pulled further away from the 200-day EMA, affirming a bullish near-term trend.
While the EMAs send bullish signals, the bearish start to the week led XRP/USD to sub-$0.70, bringing the $0.6530 – $0.6417 support band into view.
Looking at the 14-Daily RSI, the 56.74 reading sends bullish XRP price signals, aligning with the EMAs. The RSI supports a run at $0.75 to bring the $0.7870 – $0.7737 resistance band into play.
4-Hourly Chart
Looking at the 4-Hourly Chart, the XRP/USD faces strong resistance at $0.70. Despite the bearish Monday session, XRP/USD remains above the $0.6530 – $0.6417 support band.
However, XRP sits below the 50-day EMA ($0.7317) while holding above the 200-day EMA ($0.6185), sending bearish near-term but bullish longer-term price signals. Significantly, the 50-day EMA narrowed on the 200-day EMA, signaling a move toward $0.65.
The 14-4H RSI reading of 29.44 indicates XRP in oversold territory, with selling pressure outweighing buying pressure. Significantly, the RSI aligns with the 50-day EMA, signaling a near-term bullish trend reversal and a run at the $0.6530 – $0.6417 support band.
Fed Fear and SEC v Ripple Appeal Chatter Delivered a Bearish Session
It was a busy start to the week, with the SEC v Ripple Court ruling continuing to grab the crypto news headlines. Amidst increased uncertainty about whether the SEC will appeal the Court ruling, the threat of the SEC continuing to regulate by enforcement also lingered.
However, recessionary jitters and Fed fear added to the bearish mood. The FOMC kicks off the two-day meeting today, with the markets betting on a final 25-basis point interest rate hike. However, there is uncertainty about what to expect beyond the summer break. A more hawkish Fed would raise fears of a US hard landing.
US economic indicators revealed slower service sector growth, with euro area PMI numbers raising the prospects of an economic recession.
The Day Ahead
SEC v Ripple Court ruling-related chatter will remain the focal point. Uncertainty surrounding an SEC appeal will continue to test investor sentiment.
However, we expect US lawmaker chatter and Binance and Coinbase-related news to move the dial.
On Monday, Amicus Curiae attorney John E Deaton had this to say about new US legislation,
“Both the Senate and the House have introduced legislation in an attempt to provide regulatory clarity for digital assets. A good faith regulator would be working with Congress and industry participants to provide a regulatory framework that fostered innovation while providing important rules like the segregation of customer funds, a bar, and penalty for commingling, 100% reserves, protecting client funds in case of bankruptcy, etc. There are tremendous things a good faith regulator could accomplish in the crypto space.”
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