XRP Price Prediction: Will It Break $3.39 Resistance or Face Profit-Taking?

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The US Securities and Exchange Commission (SEC) has appealed a key court decision that ruled Ripple’s XRP sales were not securities transactions.

The case started in December 2020 and is about whether Ripple’s distribution of XRP to retail investors is an unregistered securities sale under US law.

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In its opening brief filed yesterday, the SEC is contesting a July 2023 ruling by Judge Analisa Torres that XRP is not a security in certain transactions. The district court had ruled that Ripple’s programmatic sales of XRP through exchanges was not a securities violation. The SEC is arguing that all XRP sales – no matter who the seller is – should be securities. That includes programmatic sales to retail buyers and those made through exchanges.

 

XRP/USD

SEC’s Arguments on Ripple’s Promotion of XRP

In its appeal the SEC says Ripple’s promotion of XRP created an expectation of profit for investors. The agency claims Ripple’s promotion through social media and media outreach influenced both institutional and retail investors to buy XRP in hopes of future profits. The SEC says these efforts made XRP an “investment contract” under the Howey Test.

The SEC is disputing the district court’s reasoning that retail buyers didn’t have a reasonable expectation of profit from Ripple’s efforts because they bought XRP anonymously through exchanges. The agency says Ripple’s promotion, whether to institutional or retail investors, created an expectation of returns for both.

Ripple’s Defense and Market Reactions

Ripple says XRP is a digital currency not a security. It says the sales of XRP don’t meet the criteria of an investment contract and shouldn’t be regulated as securities. Ripple’s Chief Legal Officer, Stuart Alderoty, called the SEC’s appeal a “rehash of already failed arguments.” He thinks the appeal will lose steam with the new SEC leadership, with current Chair Gary Gensler stepping down in 2025.

XRP is up despite the lawsuits. Price just hit $3, highest since 2018, as investors hope for regulatory changes under the new SEC. Some think it could go to $6.

XRP/USD Daily Technical Outlook – January 16, 2025

XRP/USD surged above the $3.20 pivot point, trading at $3.31 after hitting an intraday high of $3.39. The bullish breakout from a symmetrical triangle pattern has generated strong upward momentum, supported by robust trading volume.

XRP Price Chart - Source: Tradingview
XRP Price Chart – Source: Tradingview

Immediate resistance is noted at $3.39, with further levels at $3.57 and $3.76. On the downside, support stands at $3.14, with deeper levels at $2.90 and $2.66 offering structural stability.

The 50-day EMA at $2.21 reinforces the bullish trajectory, while recent price action suggests further gains are likely if XRP holds above the pivot point. However, overbought conditions near resistance zones warrant caution. A sustained move above $3.39 could propel prices toward $3.57, while failure to maintain $3.20 may invite profit-taking.

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ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
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