- Stellar is holding above a robust support zone reinforced by the 200 SMA.
- The MACD indicator on the 4-hour chart suggests bears are getting exhausted as bulls fight to take control.
- A break above the confluence resistance formed by 50 and 100 SMAs will trigger massive buy orders.
- The SuperTrend indicator has a bearish impulse, likely to invalidate the bullish outlook.
Stellar has not been able to recover from the rejection at $0.6, the yearly high. Besides, the acute losses across the market this week were a big blow for the bulls. XLM tumbled to $0.3 before making a recovery above $0.4. As technicals start to improve, Stellar is looking forward to an upswing back to $0.6.
Stellar holds above the critical support area
The recovery from $0.3 was more or less reflex. However, Stellar is holding above the descending parallel channel’s middle layer support. In addition to this, the 200 Simple Moving Average (SMA) on the 4-hour chart is in line to offer support.
Similarly, the Moving Average Convergence Divergence on the same 4-hour chart brings to light the growing bullish outlook. For instance, the MACD line (blue) has broken above the MACD line, suggesting that it is time to buy-in. On the other hand, a break above the 50 SMA and the 100 SMA will pave the way for gains toward $0.6.
XLM/USD 4-hour chart
The TD Sequential indicator has recently flashed a buy signal on the 12-hour chart. This call to buy was presented in a red-nine candlestick. It implies that the bearish pressure is diminishing as buying pressure begins to surge. If validated, XLM will rally in one to four 12-hour candlesticks, validating the bullish narrative.
XLM/USD 12-hour chart
Looking at the other side of the picture
The 12-hour chart shows that Stellar is not out of the woods yet based on the SuperTrend indicator. This bearish impulse came into the picture earlier this week, following massive cryptocurrency price declines. XLM recovery will likely lag in the near term until the indicator flips bullish again.
XLM/USD 12-hour chart
Stellar must also hold above the 20 SMA on the 4-hour chart, if not the channel’s middle boundary support, to avoid potential losses. Trading below these critical levels could open the Pandora box, resulting in losses as far as $0.3.
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
Editors’ Picks
Ripple's XRP could rally to $4.75 despite rising profit-taking among investors
Ripple's XRP continued its rally on Wednesday as it looks to test the upper boundary of a key flag channel. Following the recent price rise, investors booked profits worth nearly $800 million while options traders bet on the remittance-based token hitting the $5 mark.
Caroline Crenshaw's renomination vote postponed, as crypto industry pays keen attention on voting procedures
The Senate vote on Wednesday regarding the reappointment of Securities & Exchange Commission Commissioner Caroline Crenshaw has been postponed due to a clash with procedural rules following a shift in the initial schedule.
Ethereum Price Forecast: ETH eyes new yearly high as whale and institutional holdings increase
Ethereum is up 6% on Wednesday after bouncing off the support level near $3,550. The spot market shows institutional investors and whales maintained a bullish sentiment, potentially scooping up ETH at lower prices during the recent dip.
Bitcoin reclaims $100K following release of US CPI data for November
Bitcoin surged above $100K on Wednesday following the release of the US November Consumer Price Index data, which came in line with expectations at 2.7%. Crypto investors quickly reacted to the report as market participants now anticipate that the Federal Reserve will cut rates by 25 basis points next week.
Bitcoin: Long-awaited $100K milestone meets profit taking
Bitcoin ends the working week hovering around $98,000 after a very volatile Thursday when it surpassed the $100K milestone and underwent a sharp correction. Strong institutional demand, whale accumulation, and the choice of a pro-crypto figure to lead the US SEC fueled the rally this week.
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.