• Stellar is on a downward trending slope. 
  • A break lower could bring 7% losses. 
  • Buyers have a good entry point lined up and will keep their powder dry.

Stellar (XLM) is in a classic bearish trend, with the red descending trend line acting as the backbone for the trade short sellers are in. The XLM price descent comes after hitting the high on August 16 at around $0.41. Since then, the highs kept getting lower, and the R1 monthly resistance at $0.32 quickly showed its support, holding price action up.

Let the sellers have their fun, and buyers will have an excellent entry level to take over

Sellers will try to break that R1 monthly resistance level to push buyers out of their longs and make a profit by running their stops. Expect a violent dip if that R1 resistance level gives way at $0.32. 

That is where the market is about to stop selling XLM. About 10% further down, a historical level is offering itself at $0.30. That level originates from June 20 and has shown its importance at least five times up to now. Expect that a lot of buyers will have this level as their queue to start buying XLM. That works both ways for sellers as well. They will want to book profit on their shorts when they add a position on the monthly R1 resistance level break, so this level will act as a handover from sellers to buyers.

XLM/USD daily chart

XLM/USD daily chart

Extra motivation for buyers is the 55-day Simple Moving Average (SMA) coming in just below $0.30. Between that 55-day SMA around $0.29 and the historical level at $0.30, it would make it ideal for a tiny fade-in trade for buyers. Buyers will need to watch out for putting their stop below that 55-day SMA. 

To the upside, expect a retest of the monthly R1 resistance level at $0.32 before shooting higher toward that red descending trend line again. 

For the sellers, a run further down toward the monthly pivot at $0.26 will be tempting but questionable as buyers  look for that $0.30 level as their queue.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended Content

Editors’ Picks

Ripple's XRP crosses $100 billion market cap following high expectations for its stablecoin and ETF approvals

Ripple's XRP crosses $100 billion market cap following high expectations for its stablecoin and ETF approvals

Ripple's XRP rallied near the $2 mark on Friday after rumors of New York regulators approving the company's RLUSD stablecoin surfaced. The growing demand for an XRP exchange-traded fund could also accelerate its launch in 2025.

More Ripple News
Ethereum Price Forecast: ETH eyes yearly high resistance of $4,093 amid heightened interest among US traders

Ethereum Price Forecast: ETH eyes yearly high resistance of $4,093 amid heightened interest among US traders

Ethereum is trading near the $3,600 level on Friday and could stage a rally to test its yearly high resistance of $4,093. The rally is fueled by ETH Chicago Mercantile Exchange open interest growth and a rise in USDT supply on the Main chain.

More Ethereum News
Cardano's ADA, JTO, NEON lead $570 million unlock week ahead of massive $3 billion in further December unlocks

Cardano's ADA, JTO, NEON lead $570 million unlock week ahead of massive $3 billion in further December unlocks

Tokenomist data on Friday revealed that the crypto market will witness another week of heavy cliff unlocks worth over $570 million as part of the larger $3.5 billion December supply injection.

More Cryptocurrencies News
Stellar Price Forecast: Eyes for further gains as bounces off support level and bullish on-chain metrics

Stellar Price Forecast: Eyes for further gains as bounces off support level and bullish on-chain metrics

Stellar experienced a pullback in the first half of the week but recovered in the second half and is trading around $0.54 on Friday, after rallying more than 170% and reaching levels not seen in over three years in the previous week. 

More Stellar News
Bitcoin: A healthy correction

Bitcoin: A healthy correction

Bitcoin (BTC) experienced a 7% correction earlier in the week, dropping to $90,791 on Tuesday before recovering to $97,000 by Friday. On-chain data suggests a modest rebound in institutional demand, with holders buying the dip. A recent report indicates BTC remains undervalued, projecting a potential rally toward $146K. 

Read full analysis
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

BTC

ETH

XRP