Ripple Labs’ native crypto, XRP, is in a bearish pattern, causing prices to decline by 25% in 30 days.
Ripple’s lawyers submitted a letter to support their request for dismissal of the ongoing lawsuit against the firm.
Recently, two SEC Commissioners opposed the agency’s action against Blotics.
NEW DELHI (CoinChapter.com) — Ripple Labs’ native cryptocurrency, XRP, moved below $0.55, a price level that has been strong support in the past. Moreover, the digital currency is slowly approaching its next support level, even as Ripple Labs’ lawsuit with the U.S. Securities and Exchange Commission (SEC) took a new turn on Monday.
Ripple Price Chart Woes
XRP price fell below its May 23 low of $0.63 on July 8, a price level that previously acted as resistance from December 2020 to April 2021. Moreover, XRP has fallen by 25.5% over the last month. It seems the digital asset is following the oscillations of the overall cryptocurrency market, which is down by 17.6% in July.
XRP fell below its previous major support levels at $0.572 and $0.558 today.
As such, a fall to the next support at $0.457 is likely. However, it would mean a decline of 12.9% in its prices. In case Ripple fails to consolidate at $0.457, the next support is $0.399. A drop to the next price level will remove a significant chunk from XRP’s 2021 gains.
The 50-Day (Yellow) and 200-Day (Green) Moving Average trend lines have formed a death cross, which may have lured sellers to the market.
A death cross forms when a short-term moving average moves below a long-term moving average. In addition, the 20-day Exponential MA is acting as dynamic resistance for XRP. With prices below 50 and 200 MA trend lines, the digital currency seems to be firmly in the grip of bears.
Immediate resistance for XRP is at $0.579, followed by resistance at $0.599 and $0.63.
The relative strength index, which charts price momentum, is at 29.99 for XRP. Hence, the digital asset is in the oversold/undervalued range. However, a reversal seems unlikely as XRP’s MACD moves into the bearish region as well.
MACD is a trend-based momentum oscillator. For XRP, the MACD line (difference between 12-Day and 26-Day EMA) moved below the MACD signal line (9-Day EMA of MACD).
As a result, the MACD histogram, which plots the difference between MACD and its signal line, also moved below zero. Combined with the dropping volumes, XRP is likely to continue its bear run.
On the other hand, an extended rally might push XRP prices to $0.60 before a pullback occurs.
Meanwhile, in Ripple v/s SEC
Ripple’s lawyers sent a letter to Judge Analisa Torres, highlighting remarks made by two SEC commissioners in another case. The defendant’s counsel informed the court of ‘supplemental authority‘ that supports Ripple CEO Brad Garlinghous and Executive Chairman Christian Larsen’s pending motion to dismiss the case against them.
The letter, sent by Ripple’s counsel, refers to comments made by SEC Commissioners Elad Roisman and Hester Peirce in connection with the SEC’s settled action with Blotics Ltd. Interestingly, the Blotics case was also related to securities violations.
In their comments, the SEC officials highlighted the lack of clarity around the ‘application of the securities laws to digital assets and their trading.’
The commissioners also criticized SEC’s ‘clue-by-enforcement‘ approach in deciding if a token is a security. They added that SEC should provide clear guidelines and then take action against people who ignore them. Moreover, the officials observed that people have questions about compliance and applicable laws and regulations.
Ripple’s lawyers argued that the uncertainty in determining which assets to classify as securities, as pointed out by the SEC commissioners, has relevance to the lawsuit. They added that SEC’s aiding and abetting claim against the Ripple executives requires it to prove that defendants knowingly disregarded guidelines related to securities registration.
The lawyers added that the public statement confirms that the case against Ripple’s executives is ‘legally untenable.’
In other news, SEC and Ripple rescheduled the deposition of former SEC director William Hinman to July 27. The deposition will focus on the former director’s 2018 speech regarding Ethereum’s status as a security.
At the time of writing, XRP was trading at $0.526, down 5.45% on the day.
A Delhi-based Markets writer, I did my bachelor's in engineering with major in electronics and communications. I first heard of bitcoin while writing an article about blockchain technology a few years back, and have been following it ever since. Bitcoin may well be current big thing happening in the finance industry, and it feels like the right time to join the crypto bandwagon.