- XLM’s recent price action has placed it near important resistance levels through the 20-day, 50-day, and 200-day EMAs.
- Failure to hold above key support levels could expose XLM to further downside risk.
Stellar (XLM) recently rebounded from long-term support near $0.08. Despite difficulties regaining bullish momentum, the altcoin’s recent price action has brought it closer to key resistance levels.
Let us analyze whether the bull has enough strength to continue on this trajectory.
XLM Price Analysis
Source: TradingView, XLM/USDT
After finding a stable bounce from the $0.08 support, XLM surged to test the immediate resistance level. However, the altcoin is currently struggling to break above the 200-day EMA located at $0.1007, which has limited the upside of the recent uptrend.
At the time of writing, XLM was trading at $0.0954, hovering around the 20-day EMA ($0.0945) and 50-day EMA ($0.0946). The confluence of these EMAs provided near-term support at the lower boundary of the ascending channel, potentially forming the basis for further recovery.
The relative strength index (RSI) was 53.55, indicating a somewhat neutral stance in the XLM market. A break above the 60 level would indicate short-term bullish momentum. If Bitcoin witnesses massive inflows of buyers and XLM bulls above the 200-day EMA during a bull run, it could pave the way for a rebound towards the $0.11 resistance.
Key levels to note
Apply – The $0.094 level finds immediate support near the confluence of the 20-day EMA and the 50-day EMA. A decline below this level could result in further losses for XLM, with the next support area being $0.087-$0.089.
Resistance – The 200-day EMA ($0.1007) remains an important level to watch. A break above this could test the $0.102 resistance and then move towards $0.109.
What XLM’s Derivatives Data Reveals
Source: Coinglass
XLM’s open interest increased 2.89% to $30 million, indicating that traders are still actively participating. Likewise, trading volume increased approximately 4% to $55 million. Binance’s long/short ratio for XLM/USDT is 1.858, indicating that many traders are currently opting for long positions.
OKX’s ratio was 1.68, reaffirming short-term bullish sentiment.
XLM appeared to be at a critical juncture at press time, with a rising channel challenging its bullish trajectory. If XLM fails to break out of its general pattern, the coin could continue its sideways movement with some downside risk if it falls below the $0.094 support.
Traders should especially monitor broader market trends in Bitcoin as they are likely to influence the price action of XLM.