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Stellar Price Analysis XLM / USD: Uncharted Waters

XLM sets new trading lows for the year.

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  • The four-hour time frame shows that the decline in the XLM / USD pair shows few signs of stopping
  • Stellar Lumen is heavily bearish over the medium-term and has recently fallen to an all-time trading low

Stellar Lumen remains extremely bearish across both the short and medium-term horizons, with the cryptocurrency losing close to thirty percent in value from peak-to-trough so far this month. Last week, the XLM / USD pair breached the February 2019 trading low, causing the cryptocurrency to fall to its lowest level for the year.

After peaking in May this year, Stellar Lumen has been on a steady one-way decline since forming a bearish double-top pattern formation on June 26th. In fact, since the heavy technical rejection on June 26th, Stellar Lumen has lost over fifty percent of its overall value.

From a technical perspective, the XLM / USD pair is entering into unknown territory, following the recent decline below the cryptocurrency’s all-year trading low. The daily time frame shows a large falling wedge pattern has now formed, with the XLM / USD pair approaching the bottom of the bullish reversal pattern, around the 0.061800 level.

SIMETRI Research

The daily time frame also shows that a bearish death cross is underway, and the XLM / USD pair is yet to reach oversold conditions, despite the heavy decline, according to the daily RSI indicator.

The four-hour time frame shows that a bearish head and shoulders pattern is currently in play, with buyers needing to move price above the 0.085000 level just to stabilize the decline. Technical indicators on the four-hour time frame also suggest that bearish short-term momentum is still increasing.

According to the latest sentiment data from TheTIE.io, the short-term sentiment towards Stellar Lumen is bearish, at 32.00 %, while the overall long-term sentiment towards the cryptocurrency is also very weak, at 32.00%.

 

XLM H4 Chart by Trading View
XLM / USD H4 Chart by TradingView

 

Upside Potential

The four-hour time frame is showing that bulls need to stabilize the XLM / USD pair above its 200-period moving average, at 0.076000, to change the short-term outlook. 

The daily time frame highlights the 0.096500 and the 0.101650 levels as the major upside resistance levels bulls need to move price above to secure the medium-term sentiment towards the XLM / USD pair.

 

Stellar Lumen Daily by Trading View
XLM / USD Daily Chart by TradingView

Downside Potential

The downside potential for the XLM / USD pair is focused around the $0.064800 level on the four-hour time frame, which is the current yearly low. If we see a bearish breakout under this level, technical analysis suggests a possible drop toward the $0.060000 level.

The daily time frame highlights that the large falling wedge pattern at the 0.061800 level is at the lower-trendline of the bullish pattern, and a key area to watch going forward.


Summary

Stellar Lumen has the potential to open-up even further to the downside, now that the cryptocurrency is trading in uncharted waters.

The falling wedge on the daily time frame is likely to define the trading action over the short and medium-term, making the 0.061800 level a technical area to watch.

 

Check out our coin guide for XLM.

Our analyst team also covered Stellar, offering a deep look into the project.

 

Stellar Chart

 

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DISCLOSURE

Authors at Crypto Briefing are invested in cryptocurrencies. The author of this post may be invested in digital assets mentioned here.

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