XLM Price Prediction: Stellar looks to undo 21% gains
- XLM price is on its way to undo the gains acquired between October 4 and October 7.
- Stellar might retest $0.355 before retracing 10% to $0.318.
- In a bearish case, the altcoin might extend its correction to $0.30.
XLM price witnessed a decent run-up starting on September 28. This uptrend paused between October 2 and October 6 before extending higher. Now, Stellar bulls are nowhere to be found, leading to a pullback that threatens to undo those very gains.
XLM price to free fall soon
XLM price rose 45% between September 29 and October 7, setting up a swing high at $0.370. Interestingly, Stellar managed to close below the 62% Fibonacci retracement level at $0.365, which triggered the downswing. As the run-up failed to sustain, a 5% correction emerged, pushing Stellar to where it currently stands.
XLM price will likely rise past the 50% Fibonacci retracement level at $0.343 before continuing its downtrend to $0.318. In dire cases, investors can expect XLM price to extend this pullback to retest the $0.30 support level. This downswing would constitute a 14% loss from its current position.
XLM/USDT 4-hour chart
While this downswing is a bearish outlook, it applies to the short-term outlook. Therefore, investors can expect XLM price to bounce off the $0.318 or $0.30 barriers and restart the uptrend.
However, if Stellar manages to flip the 50% Fibonacci retracement level at $0.343 and then produce a higher high above the October 7 swing high at $0.370, it will create a higher high, invalidating the bearish outlook.
Such a move could kick-start a new uptrend to $0.38 or a high time frame resistance level at $0.426.
Author
Akash Girimath
FXStreet
Akash Girimath is a Mechanical Engineer interested in the chaos of the financial markets. Trying to make sense of this convoluted yet fascinating space, he switched his engineering job to become a crypto reporter and analyst.
