Stellar Lumens / USD Technical Analysis: Black Sheep
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- Stellar remains bearish in the short-term despite the recent recovery in the cryptocurrency
- Bulls still have much work to do to reignite the popular cryptocurrency
- Overall bearish medium-term bias is still intact for the XLM / USD pair
Stellar Lumens / USD Short-term price analysis
In the short-term, Stellar Lumens remains bearish despite the recent rally in this crypto and the broader cryptocurrency market. Positive signs are emerging that a major technical price floor may have been formed, although it is currently too early to call a bottom in the XLM / USD pair, given that it is currently in a downtrend.
Traders should look for signs of price stabilization above the pair’s 50-period moving average on the four-hour time frame, as it may signal the start of a stronger rally in this pair.
Pattern Watch
The series of bullish lower lows is a positive development in the short-term, a move towards the January 31st trading high or the pair’s 200-day moving average could potentially help to form a bullish inverted head and shoulders pattern.
XLM / USD H4 Chart (Source: TradingView)
Moving Averages
The 50 and 200-period moving averages on the four-hour time frame highlight the possible upside path for the XLM / USD pair if bulls start to take charge in the short-term.
MACD Indicator
The MACD histogram is neutral, while the signal line has crossover above the neutral line for the first time since early January.
Stellar Lumens / USD Medium-term price analysis
Stellar Lumen remains bearish over the medium-term time horizon, with bulls needing a substantial upside rally to occur before the medium-term outlook towards the XLM / USD pair can change.
The bearish breakout from the symmetrical triangle toward the end of January, pushed the XLM / USD pair to a fresh all-time low, which was made just last week.
Technical indicators on the daily time frame suggest that the XLM / USD pair has significant scope to recover higher, although traders should note that the cryptocurrency currently still trades below its ICO price and 50-day moving average.
Pattern Watch
Traders should watch for the potential formation of a major technical bottom if the XLM / USD pair’s former weekly trading low holds in place over the coming weeks.
XLM / USD Daily Chart (Source: TradingView)
MACD Indicator
The MACD histogram is turning higher on the daily time frame while the signal line has significant upside potential.
Stochastic Indicator
The Stochastic Indicator on the mentioned time frame has recovered from extremely oversold conditions. If bulls can halt the recent pullback, a further upside in the indicator appears possible.
Conclusion
Stellar Lumens is another interesting cryptocurrency to watch in the short and medium-term, as it has significant scope to rally higher if a long-term price floor can be established.
A degree of caution is warranted given that Stellar has been in downtrend since November 2018 and its overall weak technical standing. Ultimately, the XLM / USD pair needs to make a strong move higher over the coming days, or it is at risk of further protracted losses.
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