XLM Price Forecast: Stellar Braces for Major Pullback if This Crucial Support Breaks Down

Last Updated July 23rd 2021
2 Min Read
  • Stellar readies for another downswing as support areas weaken.
  • Breaking below the 200 SMA support may trigger massive losses toward $0.4.
  • Stellar is down nearly 16% in 24 hours to exchange hands at $0.47. The bearish wave sweeping across the market has not spared the bulls, who currently battle to secure the key support at the 100 Simple Moving Average (SMA) on the four-hour chart. The short-term technical outlook reveals that the slightest resistance path is downward, with losses likely to extend to $0.4.

    Stellar on the Verge of a Gigantic Breakdown

    The Moving Average Convergence Divergence (MACD) shows that Stellar is in the bears’ hands. This follows the movement from highs of 0.035 to lower levels within the negative region. Moreover, the MACD line (blue) extends the signal line’s divergence, further cementing the bearish narrative.

    XLM/USD Four-Hour Chart

     Stellar XLM Four-Hour Chart

    Stellar holds at the 200 SMA at the time of writing, but as established, the trend leans to the bearish side. Cracking through this support could see massive sell orders triggered due to fear of market instability. On the downside, $0.45 is the next tentative support which, if lost, XLM will drop fast toward $0.4.

    The SuperTrend indicator has a bearish impulse, as observed on the four-hour chart. This call to sell manifested in the indicator changing to red from green and shifting the position above the price. As long as the technical picture remains unchanged, Stellar would take on a downtrend.

    XLM/USD Four-Hour Chart

     Stellar XLM Four-Hour Chart

    The Parabolic SAR has also validated the bearish outlook. Like the SuperTrend indicator, the parabolas (dots) have moved above the price to reinforce the bearish outlook. Until formidable support is found, Stellar’s downtrend might remain intact.

    On the other hand, it is essential to realize that the downtrend will be sabotaged if Stellar stays above the 200 SMA support. Hence, bulls will likely shift the focus from defense to higher price levels at $0.55 and $0.65, respectively.

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