XRP Price Falls 20% After SEC Appeal — Correction May Not Be Over

Key Takeaways

• Ripple (XRP) broke down from an ascending support trend line.
• The price also decreased under the $0.55 horizontal area.
• Is the correction over, or will more downside follow in October?

The XRP price has increased since July. At the end of September, the price seemed to have broken out from a long-term resistance trend line. However, it could not sustain the increase and fell back inside the trend line on Oct. 1, decreasing by 20%.

Let’s analyze the XRP movement and see if the correction is over or if the price will fall further in October.

XRP Price Breaks Down

The daily time frame XRP chart shows that the price broke down from an ascending support trend line on Oct. 2.

Previously, the trend line had existed since July, so its breakdown could mean that the upward trend is over.

Furthermore, XRP fell below the $0.55 horizontal area, which was expected to provide support.

The next closest support area is $0.49, created by the 0.618 Fibonacci retracement support level.

During the breakdown, technical indicators turned bearish. The Relative Strength Index (RSI) fell below 0, while the Moving Average Convergence/Divergence (MACD) decreased below 0.

As a result, the daily time frame price action and indicator readings are negative.

Slew of Ripple News

Recently, some interesting Ripple news has been, specifically regarding the Securities and Exchange Commission’s (SEC) lawsuit. Firstly, Gurbir S. Grewal, the Securities and SEC’s enforcement director, announced on Oct. 2 that he will step down.

The timing raised some eyebrows since it was made the same day that the SEC filed its appeal on the Ripple lawsuit.

The SEC filed its appeal on Oct. 3 but did not specify which aspects of Judge Torres’s ruling it intends to challenge. The appeal could prolong the four-year legal battle. Ripple CEO Brad Garlinghouse was defiant, stating that they will “continue fighting for as long as it takes.”

More positive news: BitWise filed for an XRP ETF on Oct. 1, while Grayscale announced its XRP trust. Additionally, Ripple announced a partnership with Mercado Bitcoin and an in-principle approval for a financial services license from the Dubai Financial Authority.

More Downside Possible?

The daily time frame wave count aligns with the negative price action. The most likely count suggests that XRP has been mired in an A-B-C corrective structure (black) since. If so, it is now in wave C.

Giving wave C the same length as wave A leads to a low of $0.46, slightly lower than the 0.618 Fibonacci retracement support level. This is also a horizontal support area.

After reaching the low, the XRP price can begin another upward movement, surpassing $0.65.

XRP Price Corrects

The XRP price has fallen since Sept. 29. The price action, indicator readings, and wave count suggest that the correction will deepen.

The first area that could provide support is at $0.46.

Read More: XRP Price Prediction 2024: XRP Price Analysis