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Will XRP Price Gains Come Undone As Federal Court Rejects Ripple Ruling?

XRP price stability in jeopardy as Judge Jed Rakoff ignores the Ripple ruling, allowing the SEC to proceed with case against Do Kwon.
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Will XRP Price Gains Come Undone As Federal Court Rejects Ripple Ruling?

The position of XRP in the market as a cryptocurrency and not a security token is once again in question following a recent ruling made by SDNY District Judge Jed Rakoff, which allows the Securities and Exchange Commission (SEC) to carry on with the lawsuit against Terraform Labs and its founder D Kwon.

Legal representatives of Terraform and Kwon had filed a motion to dismiss the SEC’s case, citing the ruling made in the Ripple vs SEC lawsuit.

Judge Rakoff did not give any regard to the early July ruling, delivered by Judge Analisa Torres, which distinguished between institutional XRP sales and public sales, such as those on third-party exchanges like Coinbase and Binance.

The judge asserted that the regulator has jurisdiction to proceed with the case which would determine if Kwon and his company Terraform violated security laws.

Meanwhile, XRP down 2.4% in the last 24 hours, is trading at $0.6881. The turbulence in the market cuts across the board with Bitcoin price falling by 1.6% to 28,932 while Ethereum is holding firmly to support at $1,830 following a 1.7% drop.

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How Far Can XRP Price Tumble?

Attempts to push XRP price to $1 have been futile despite the Ripple ruling, which deemed XRP not a security token but particularly for sales made via exchanges. While the token rallied substantively to trade highs of $0.93, it has generally wobbled within the range stretching from $0.68 and $0.85.

XRP/USD four-hour chart | Tradingview

XRP price has in the last few weeks been confined in the lower range of the channel, thus putting a lot of pressure on support at $0.68. It is essential for bulls to keep this support intact, otherwise, sellers could tap sell the signal from the Moving Average Convergence Divergence (MACD) indicator.

Such a bearish call compels traders to close their long positions and open short positions and is characterized by the MACD line in blue flipping below the signal line in red. The bearish outlook in XRP becomes more apparent with the momentum indicator sliding toward the mean line (0.00) of further below it.

While recovery from the range resistance at $0.68 cannot be ruled out, traders need to be cautious keeping in mind the support turned hurdle at the 100-day Exponential Moving Average (EMA) (blue) at $0.6977.

A sustained break above $0.7 would mean that the range support is sturdy enough to arrest potential declines, possibly averting an impending sell-off, with the Ripple ruling seemingly in trouble.

Traders who may be eyeing new exposure to XRP longs should be on the lookout for gains above $0.7 – the resistance level at the 100-day EMA. A sharp spike in volume may follow, which is crucial for the climb to $0.75  as well as the range high of $0.85.

Declines below the immediate $0.68 support might extend to revisit the 200-day EMA and if push comes to shove due to investors selling in panic, XRP price could sweep the liquidity at $0.6 before resuming the uptrend to $1.

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John Isige

John is a seasoned crypto expert, renowned for his in-depth analysis and accurate price predictions in the digital asset market. As the Price Prediction Editor for Market Content at CoinGape Media, he is dedicated to delivering valuable insights on price trends and market forecasts. With his extensive experience in the crypto sphere, John has honed his skills in understanding on-chain data analytics, Non-Fungible Tokens (NFTs), Decentralized Finance (DeFi), Centralized Finance (CeFi), and the dynamic metaverse landscape. Through his steadfast reporting, John keeps his audience informed and equipped to navigate the ever-changing crypto market.

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Why trust CoinGape: CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights to our readers. Our journalists and analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
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