XLM Price Rollercoaster: Is Stellar Lumens’ Downturn a Signal of Bullish Fatigue?
Hold onto your hats, folks! The XLM price has been on a wild ride, and we’re here to break it down for you. Stellar Lumens (XLM) recently burst out of a tight range, posting a whopping 46.3% gain in a single day. But wait, there’s a twist! A considerable chunk of those gains has vanished, leaving us all wondering: is this a sign of bullish exhaustion?
The XLM Price Saga: A Tale of Gains and Losses
In the last 72 hours, the market correction has seen Bitcoin [BTC] and major altcoins, including our star player XLM, lose a fair share of their recent gains. Stellar Lumens had previously escaped a tight range with a 46.3% surge in just 24 hours. However, over half of those gains have evaporated, with the XLM price now lurking below the $0.130 resistance level.
XLM Price: A Bear Trap or a Bullish Limit?
With BTC dipping below $30k, will XLM sellers seize this retracement, or are we looking at a bear trap? Has the bullish rally hit a wall? The XLM price breakout led the altcoin to a year-high of $0.198, propelled by the Fear Of Missing Out (FOMO) sparked by Ripple’s positive judgment.
Despite the bullish gains, a sharp retracement followed, pushing the XLM price below the $0.130 resistance level. With the price hovering just below this key level, we’re faced with two distinct possibilities for the long term.
XLM Price: The Bearish and Bullish Scenarios
The 12-hour timeframe highlights the current selling pressure. Bears could leverage this to kickstart a sustained downtrend, with a bearish candle close below the resistance triggering a significant downward move. Alternatively, this retracement could be a bearish fake-out, with bulls scouting for new long opportunities. This could trigger another price rally from the $0.130 level, especially if Bitcoin recovers the $30k-$31k price zone.
Meanwhile, the Relative Strength Index (RSI) slipped out of the overbought zone but stayed above the neutral 50, indicating decent buying pressure for XLM. The Chaikin Money Flow (CMF) turned negative with a reading of -0.03, hinting at capital preservation moves by day traders.
Market Speculators: A Cautious Approach to XLM Price
Exchange long/short ratio data from Coinglass reveals a cautious stance by market speculators. Shorts and longs are nearly balanced, with shorts holding a slim 50.59% share over longs 49.41% share of all open XLM contracts. This leaves a window of opportunity for either bears or bulls to exploit, based on the market’s reaction to Bitcoin’s price action.