Key Takeaways:
- XRP could lose another 40% due to a bearish setup.
- The SEC vs Ripple case moves ahead in another ruling in Ripple's favor.
- Hinman speech remains the cornerstone of the case.
YEREVAN (CoinChapter.com) – XRP pulled off a 50% breakout in mid-September and reached $0.55 for the first time since early May. However, the digital asset showed signs of weakness after retesting a former resistance/support bar. The XRP/USD exchange rate stood at $0.48 on Sep 30, hinting at more losses.
XRP Price Played Out a Bearish Formation
The XRP price action played out CoinChapter’s prediction and confirmed a setup known as the ‘descending triangle.’ The latter consists of a descending resistance line, and flat support, that prevents sharp depreciations.
However, once the price action breaks below the said support, the formation forecasts a drop equal to the maximal height between the trendlines. Thus, the triangle pinned the target price for XRP at approximately $0.2.
However, the token’s drop didn’t quite reach the target and bottomed out at nearly $0.3, camping at the said support from June to September.
After the latest price jump, associated with CEO Garlinghouse’s interview, XRP retested the triangle’s support bar as resistance. Additionally, given the decline in daily trading volumes and the overall bearish bias across the market, a further 40% decline to the $0.3 support appears likely.
Meanwhile, a breakthrough in the SEC vs Ripple lawsuit might just be the remedy XRP needs for another bullish move.
Also read: XRP soars 40% after Ripple CEO hints at a confident win against SEC.
SEC vs Ripple: what happened?
James K Filan, an attorney involved in the lawsuit the US Securities and Exchange Commission (SEC) filed against blockchain startup, and the creator of XRP token Ripple Labs, shared the latest developments with his followers on Twitter.
According to the tweet, Judge Torres overruled the SEC’s objections and ordered the agency to turn over the Hinman Speech-related documents.
Another attorney, Jeremy Hogan, agreed that the ruling was positive for Ripple.
Why is the Hinman Speech important?
NOTE: The law enforcement agency claimed that XRP is unregistered securities. Thus any XRP sale would fall under SEC jurisdiction and go against the US investment laws. However, the case still continues with no proof of XRP status from the governmental agency.
In detail, the fact that the SEC didn’t extend the same ‘courtesy’ to larger cryptocurrencies like Bitcoin and Ethereum became the cornerstone of the lawsuit and one of the primary defense fronts. Furthermore, the defense cited what is now referred to as the “Hinman Speech” to prove their point.
William Hinman is the former Director of the Corporation Finance Division at the SEC. In his June 2018 speech, Mr. Hinman voiced his position on defining digital assets.
Putting aside the fundraising that accompanied the creation of Ether, based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions.
said the former official.
