XLM Price Analysis: Stellar Back On The Drawing Board But Could Soon Exhaust The Downside
- XLM price recoils from crucial support established at $0.22.
- Minor buy signals encourage investors to hold onto their bags ahead of uptrend continuation.
Stellar continued to retreat from the critical resistance at $0.3 despite the persistent effort by the bulls to enact a recovery. The broad-based declines on Wednesday saw major crypto assets sink investors into losses. For example, Bitcoin tested $31,600 while Ethereum dropped to $1,850.
Meanwhile, XLM trades at $0.23 after running into a barrier at $0.24. The descending parallel pattern reinforces this hurdle, challenging bullish advances. On the downside, the channel’s middle boundary is expected to provide immediate support and stop bears from slashing the gains accrued over the last 24 hours.
Why XLM Price Could Gain More Ground Toward $0.3
The Moving Average Convergence Divergence (MACD) indicator presents a bullish signal on the 12-hour. Note that this technical tool follows the trend of an asset and calculates its momentum. As the moving averages within the indictor oscillate, buy or sell signals are sent.
For instance, the 12-day exponential moving average (EMA) has recently sent a compelling signal to investors to buy XLM as it crossed above the 26-day EMA. The bullish narrative will be reinforced by the MACD closing the day above the mean line (0.00) and settling in the positive region.
XLM/USD 12-hour chart
The TD Sequential indicator also presents a buy signal on the daily chart. This call to go all-in on XLM manifest in a red nine candlestick and compels investors to consider taking more positons as overhead pressure wanes, creating a path for an upward trajectory.
Previously validated buy signals have resulted in significant gains. Hence, Stellar could be catapulted to $0.3 amid renewed appetite for XLM.
XLM/USD daily chart
Looking At The Other Side Of The Fence
The expected uptrend is not guaranteed, especially with a death cross pattern appearing on the daily chart. As the short-term moving average crosses below its longer-term moving average, the odds for correction rise. Therefore, Stellar will likely extend the bearish leg under $0.2 or consolidate around this same level before the next move.