Stellar (XLM) is testing descending channel resistance, signaling a potential breakout attempt. The coin trades near $0.163, according to CoinMarketCap, as traders watch for a move that could shift short-term market sentiment.
Price compression after weeks of lower highs suggests a volatility expansion may be approaching. A confirmed breakout could drive price toward key resistance levels above current zones.
Stellar (XLM) Breakout Attempt
Crypto analyst Jonathan Carter stated in an X post today that Stellar (XLM) is about to hit a major resistance area. In his view, XLM will probably complete its descending channel formation because of the current price compression.
The first price target upon completion of the channel is approximately $0.200. Further targets are at $0.255, $0.310, $0.380, and $0.430.
If a breakout occurs, there is potential for immediate price appreciation as a result of a rapid increase in the number of buyers at current price levels. However, the price could fail to break above the resistance level. Then, there could be a substantial potential for continued downward movement towards current support zones.
Also Read | Stellar (XLM) Breaks Long-Term Downtrend: Momentum Signals Rally to $0.27
Indicator Signs and Trend Structure
The TradingView chart shows how the price of Stellar (XLM) compares to the moving averages. Stellar is situated below the 200 EMA, 50 EMA, and 20 EMA, indicating continued bearish pressure across multiple timeframes.
Stellar’s current RSI value is approximately 48, which shows a moderate rise in bullish momentum. However, there is not enough upward momentum for a full-scale rally.
Early indicators of potential bullish crossover activity exist according to MACD data. The MACD data also suggests that bearish momentum has been decreasing.
According to TradingView, volume currently exists steadily. As such, we have seen no evidence that buyers and/or sellers are aggressively getting into new positions.
Insights from Derivatives and Liquidations
Open interest decreased by around 2.95% based on CoinGlass. Based on this data, there is an indication that there was less participation than in the last day for Stellar (XLM) trading activity.
In addition, funding rates are marginally negative. Therefore, it indicates that bears have control over the sentiment in the market.
Liquidation Heat Map Data
The Coinglass heatmap shows the highest concentrations of liquidation activity at key price levels. According to this heatmap, there are high concentrations of liquidation activity in two price levels, and they are $0.17 and $0.175.
Movement into these areas could strongly influence price action and result in many holders rapidly selling their holdings.
Important Zones
Immediate resistance is located at the top of the descending channel at approximately $0.17. If confirmed, breaking above this zone may create an opportunity for additional upward momentum. This would be towards the next resistance zones, including but not limited to $0.20.
Two key levels of support exist under this channel. These include a level near $0.15 and another at the base of the descending channel.
A successful breach of either of these support areas may allow prices to continue falling towards lower support levels. If Stellar (XLM) fails to break through this significant resistance zone, it could lead to continued consolidation in the channel.
Why This Matters
If Stellar (XLM) breaks out above this critical resistance zone, it may result in rapid upward price movement across a cluster of price target areas.
This article contains market analysis and price predictions. These are not guarantees. Crypto markets are volatile. Always DYOR. Not financial advice.
Also Read | Stellar Price Outlook: Can XLM Hit $0.18 by March 31?
