5 min readThe legal battle between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) continues to influence the price trajectory of XRP.
In the latest turn, Judge Analisa Torres denied a joint motion seeking to modify an earlier judgment, which triggered a sharp drop in XRP’s value. Despite this setback, optimism around a potential XRP spot ETF approval remains strong. With open interest on the rise and large buyers absorbing sell pressure, the stage may be set for renewed volatility—and opportunity—in the weeks ahead.
SEC vs Ripple developments
XRP fell over 6.5% yesterday following another twist in the ongoing Securities and Exchange Commission (SEC) vs. Ripple case. Judge Analisa Torres has denied the joint motion for an indicative ruling on their settlement.
Ripple and the SEC filed a joint settlement on May 8, requesting an indicative ruling to dissolve the injunction in the August 7, 2024, judgment prohibiting XRP sales to institutional investors. Judge Torres also rejected the request to reduce the penalty from $125 million to $25 million.
XRP ETF approval
Despite this setback in the SEC vs. Ripple case, the chances of the SEC approving an XRP spot ETF this year remain elevated. According to Polymarket, the odds remain high, reaching 81% today, up from 66% just under a month ago. That said, the ruling could delay the approval of several spot ETFs.
The broad expectation is that the SEC will delay approving ETFs until the courts dismiss the appeal against the Programmatic Sales of XRP ruling.
This possible delay in the ETF approval impacted demand, pulling XRP from its 10-week high of 2.65 to a low of 2.35.
Rising open interest & sellers’ absorption could support XRP higher
According to data from CryptoQuant, XRP could be on the verge of a breakout. XRP’s open interest has increased dramatically recently, which suggests more trade activity and boosts optimism for future XRP price gains.
In addition to rising open interest Cerypto Quant has also noted seller absorption. This is a scenario whereby strong buyers absorb selling pressure without appreciable price reduction. Large buyers are absorbing market sell-offs, a tendency that can occur during accumulation phases before price rallies.
Where next for XRP price?
XRP has managed to hold consistently above the $2.00 support level, having broken out from its multi-month descending channel. The price briefly surpassed 2.50 the 50% Fib retracement of the 3.4 high and 1.61 low.
Buyers will need to rise above the 2.50 level and 2.75 to create a higher high and bring 3.00 into focus.
Support is seen at 2.30, the 100 SMA, and the 38.2% Fib retracement.
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