XRP price has entered consolidation mode after failing to maintain its rally above the critical level of $0.5. At time press time, the altcoin was trading 3% lower at $0.4755 after being in the red over the past week. XRP’s total market cap has slipped by more than 1% over the last day to $25 billion, ranking the altcoin the 6th largest cryptocurrency after USD Coin.
SEC vs Cryptocurrencies
Bulls have lacked enough momentum to sustain the XRP price rally above $0.5 after facing a strong rejection at the $0.5290 resistance level. Even so, the positivity surrounding the legal battle between the US Securities and Exchange Commission (SEC) and Ripple has seen the altcoin climb 42% in the year to date.
Ripple Labs has been in a legal battle against the Wall Street regulator for about 3 years now. The SEC filed a lawsuit against the company, alleging that it offered unregistered securities to customers through the sale of XRP, the cryptocurrency associated with Ripple Labs.
In its lawsuit, the SEC argues that XRP is a security and should have been registered with the commission before its distribution. Conversely, Ripple has maintained that XRP is a digital currency, therefore falling out of SEC’s jurisdiction. The outcome of the lawsuit will have significant implications on the XRP price and the crypto sector, as it could potentially set a precedent for how other cryptocurrencies are classified and regulated.
Recently, the SEC filed a lawsuit against crypto exchanges Binance and Coinbase, accusing them of various violations, including selling unregistered securities. In the lawsuit, the US Securities and Exchange Commission also deemed a slew of cryptocurrencies, including Polygon, Cardano, and Solana, as securities. While the case still awaits a decision, recent evidence suggests that there is no guarantee for a positive outcome, thus leaving investors in consolidation mode.
XRP Price Analysis
The daily chart shows that the XRP price has been moving sideways for the past few days amid the intensive regulatory crackdown on cryptocurrencies and macroeconomic uncertainties. The digital asset has managed to move below and above the 50-day and 200-day exponential moving averages, respectively. It is also moving below the 50-day and 100-day simple moving averages.
Its Relative Strength Index has dipped below the neutral zone and the signal line to 42, hinting at accelerated selling pressures. The Moving Average Convergence Divergence (MACD) indicator, as well as the Momentum indicator, suggests a bearish trajectory.
Therefore, there is a possibility that the XRP price will pull back further in the ensuing sessions as sellers target the next support level at the 200-day EMA at $0.4545. On the other hand, a flip above the bullish support zone at $0.5 will give bulls more momentum to push the price higher to $0.5290.