Stellar (XLM) is currently trading at around $0.09 following some consolidation after a recent drop of nearly 25% in price. This year has been one of the worst for the IBM-backed cryptocurrency, as price has tumbled down below all its EMAs.
Although sellers have been in control for the last few weeks, price has been consolidating nicely recently, much like most other cryptocurrencies. I therefore expect buyers to regain control soon and push XLM upwards.
Let’s take a look at the chart for Stellar.
As you can see, price bounced near $0.085 this week, highlighting a clear wall that is not letting price drop any lower.
However, at the time of writing, XLM has been underperforming most other coins in the cryptocurrency market.
Looking at the chart, we can see there was a spike after May that took XLM from the $0.085 region to higher than $0.16, representing a 100% price increase.
Of course, after investors started cashing out some gains during the months of May and June, price dropped below a number of key levels, including the 20-day EMA, 50-day EMA, and the 200-day EMA.
If price follows the current market trend, we should see XLM pick up pace and quickly get out of the hole it’s currently in. I argue XLM will soon return to near its 20-day EMA (the red line on the chart) around $0.11.
The next resistance level for Stellar is around $0.10, and there’s a massive wall near $0.12 – $0.125. Once price breaks above this level and finds support, we can expect XLM to outperform BTC and ETH.
Of course, there’s also a chance the coin may not recover. However, given the strong fundamentals, I personally believe it is just a matter of time before Stellar is back on track.
For now, enjoy the buying opportunity!
About Stellar Lumens
Stellar was founded in 2014 by Jed McCaleb and Joyce Kim. At launch, it was based on the Ripple protocol, but the network eventually forked. Stellar is an open source protocol for exchanging money where servers use the internet to connect to and communicate with other Stellar servers, forming a global value exchange network.
Stellar Lumens is one of the largest cryptocurrencies and is one of the top 10 cryptocurrencies by market capitalisation.
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