Stellar (XLM) remains near an inflection point despite its 7.5% upside, with both bulls and bears looking undecided over the next move.
Stellar has gained about 7.5% in the past 24 hours, rebounding above $0.20 as the crypto market looks to shed Tuesday’s negative action. At the time of writing, XLM was trading at $0.21, up from its lowest price of $0.195 logged on June 22.
The upside on the daily log for Stellar comes as major cryptocurrencies Bitcoin and Ethereum led the market in bouncing off multi-week lows, with BTC plugging the leak to lows of $29k while ETH has recouped some of the losses that saw it trade near $1,700.
Pseudonymous trader Daan Crypto is bullish on near term prospects of BTC and alts, noting via a tweet that the bellwether crypto’s rebound above $30k and the negative funding in altcoins is a “promising signal” for the market.
$BTC Great retake of the range low. Looks like a nice deviation now.
We’ll have to see if BTC can continue here but retaking the range was the most important thing$ALTS had a nice bounce too and funding is still very negative so that’s slightly promising.
— Daan Crypto Trades (@DaanCrypto) July 21, 2021
For XLM, bulls can retake advantage if prices breach resistance above $0.24. If not, continuation of recent sell-off pressure could see prices break below $0.20 once more.
XLM price technical outlook
On the daily log, XLM/USD is looking to bounce off support at the 78.6% Fibonacci retracement level of the macro move from $0.079 to year-to-date highs of $0.80. But action remains restricted within a descending channel and potential upward moves are likely to run into rejection at the 20-day moving average ($0.24) and 50-day moving average ($0.28).
Looking at a higher timeframe, Stellar’s XLM price has broken below the major support line at $0.20 twice, trending in red in three of the past four weeks. Although bulls have attempted to buy at every dip, the consecutive losses highlight growing weakness.
For instance, the price has moved away from the 50-week SMA, while the weekly RSI suggests the path of least resistance could be a continuation of the downward trajectory.
If the cryptocurrency market turns bearish, XLM could flash red to prices near $0.11. Below that, further rot could align with a retest of $0.079 in the near term.