- XLM price dropped 13% as the entire market took a downturn.
- Stellar is trying to find a foothold above the swing low formed on May 29 at $0.343.
- While an upswing may seem likely, the sell-off could continue.
XLM price entered a deep sell-off as it sliced through a crucial support level. While it appears to have found support on the recent swing low, things could get ugly fast if the sellers continue to dump their holdings.
XLM price might sweep range lows
XLM price is currently trading at $0.344 after sliding 13% over the past 12 hours. This sell-off comes as the entire market structure for many cryptocurrencies was half-assed as they tried to recover from the May 19 and May 23 crashes.
In an optimistic scenario, the intermediate support levels at $0.327 and $0.30 could stop the bleeding and serve as a platform for reversal.
However, from the looks of it, this downswing may not be over. A worst-case scenario could see Stellar price retest or sweep the range low at $0.274 formed due to the May 23 crash.
Perhaps, a reversal that stems around $0.274 would have more oomph than if it originated from the intermediate support barriers mentioned above.
Therefore, investors should keep an eye out for a continuation of this sell-off.
XLM/USDT 4-hour chart
On the flip side, if XLM price manages to ignore the market conditions and produces a decisive close above the 50% Fibonacci retracement level at $0.372, it would invalidate the bearish outlook and signal the presence of buyers.
Sustained trading above this range would indicate that the recovery has begun. In such a case, Stellar price could retest the swing highs along the way, but the buyers would target the supply zone’s lower limit, which nearly coincides with the range high at $0.47.
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