- Stellar is consolidating between the 200 SMA and the 100 SMA.
- An ascending triangle breakout could lift XLM by 35% to $0.65.
- The SupeeTrend indicator has a bearish impulse likely to delay the breakout.
Stellar stalled at $0.48 following the dip to $0.3. Sideways price action seems to have taken precedence, but XLM appears to be leaning to the bullish side. The cross-border token is also trading between two key levels that might determine its future. Meanwhile, Stellar is looking toward a 35% technical breakout, aiming for $0.65.
Stellar must break above crucial resistance for a technical breakout
XLM is trading at $0.42 while stuck between the 200 Simple Moving Average (SMA) support and the 100 SMA resistance on the 4-hour chart. Due to the seller congestion between these two key levels, Stellar seems to have settled for consolidation before a potential breakout.
The 4-hour chart brings to light the formation of an ascending triangle. The pattern confirms the consolidation that may culminate in a massive upswing in the same direction as the previous trend. Ascending triangles are drawn using two trendlines, a horizontal one connecting a series of equal peaks and another linking consecutive rising lows.
A breakout is expected as soon as the price slices through the horizontal resistance. Triangles also have precise breakout targets measured from the highest to the lowest points.
XLM/USD 4-hour chart
It is worth mentioning that XLM will continue with the sideways action based on the Moving Average Convergence Divergence. The indicator does not have a defined signal amid the leveling at the midline. However, bulls must look out for the MACD cross above the signal line, which may validate the uptrend.
Looking at the other side of the picture
The SuperTrend indicator on the same 4-hour chart shows that Stellar has a bearish impulse. It is a technical indicator traders use to predict long-term trends. Flipping red and rising above the price is a call to sell, while turning green and moving under the price reveals that we are in a bull market. Currently, the SuperTrend indicator shows that sellers still have the upper hand.
XLM/USD 4-hour chart
Similarly, the parabolic SAR points have also confirmed the bearish narrative. Stellar will liftoff significantly when the parabolas shift below the price. However, for now, the bearish influence is apparent and could continue to delay the breakout.
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.