Key Points:
- Ripple’s XRP was down by 12.75% and reached a one-month low primarily due to the appeal of the SEC regulations as well as tensions from the Middle East.
- The legal battle between the SEC and Ripple along with the recent partial court win has brought back market unrest.
- Political instabilities in the Middle Eastern region are forcing traders to invest in safer digital currencies, hence the resurgence of selloffs in XRP.
- If XRP is able to find support at certain key levels, we may soon see a technical rebound in October.
XRP’s Price Decline
XRP, which is associated with Ripple, was one of the most influential tokens in the last 24 hours, with a 12.75% depreciation. Therefore, the token is now trading at a one-month low of $0.511 on October 3. The massive sale was triggered by the SEC’s recent appeal on Ripple’s trial that partly went in its favor. This was accompanied by raised geopolitical risks in the Middle East region, further reducing investors’ confidence.
SEC’s Appeal Reignites Market Uncertainty
On October 2, the SEC filed an appeal of the October 2023 decision delivered by Judge Analisa Torres, which stated that XRP’s secondary market sales were not securities under the Howey test. This appeal has brought new additional risk and confusion to the market since a higher court may overturn the earlier judgment and declare XRP security.
XRP had recorded an impressive recovery after Judge Torres’ decision, favorable to Ripple, but the action by the SEC has erased those gains. The cryptocurrency has been in the red this month, with its value shrinking by 15.72%, wiping out all of September’s gains.
Geopolitical Tensions and Safe-Haven Assets
Adding to this is the increase in unrest in the Middle East, which also discourages the use of the XRP token. The attacks on Beirut and the subsequent rise in expectations of a response against Iran have widened the market selloff. Global investors are also choosing assets that provide a safe haven, such as the USD and government bonds, making risk assets, including XRP, further drop.
Equity markets worldwide have done the same, with European shares and U.S. equity index futures shrinking due to geopolitical dangers. At the same time, it seems that the safe-haven demand is strengthening; the U.S. dollar index DXY reached a one-month high, while XRP marked a one-month low.
Possible XRP Price Recovery in October
However, XRP is still trading within an upward-sloping trend, which indicates that, from a technical perspective, the XRP price may still rebound. Since the middle of September, the cryptocurrency has been trading within the range of two trendlines; the upper one is a resistance level at $0.65 – $0.69, while the lower one is a support level at $0.50 – $0.52.
As of today, in the vicinity of $0.5165, XRP is located at the 0.618 Fibonacci retracement level, which traditionally becomes a buying zone. With this support, the XRP could bounce back and possibly reach the $0.65 retracement level by mid-October.
If, however, it goes below this support, it may encourage lower moves toward the next support zone at $0.4639, having used the 0.236 Fibonacci retracement.
Conclusion
Unfortunately, XRP is under pressure due to the SEC appeal and geopolitics affecting the asset. Nonetheless, the tech-based assessment propels for a rebound. Some technical indications point to possible gains in the next few weeks if crucial support limits are maintained, but more losses may be forthcoming if these levels are breached. Traders should keep their eyes open, particularly as the legal aspects could turn favorably or unfavorably within short notice, not to mention global events that can drastically change the market at any given time.
Also, Read @ Market Overview: Crypto Continues to Dip but Bitcoin Stabilizes
