While publishing this post, Stellar dipped inside a long-term squeeze around the POC (Point of Control). The latest drawdowns have re-confirmed the bearish outlook as XLM prices battle to overcome the 20 Exponential Moving Average.
Any closing beyond the 3-month trend-line resistance would place the altcoin on an upside move in the short-term. However, bulls should trigger increased buying momentum to cancel the prevailing bearish movements. XLM changed hands near $0.11349 during this publication.
Stellar Daily Timeframe
Meanwhile, the bearish move from $0.2 saw the alt printing a 3-month trend-line resistance on the 24-hours chart. The alternative token lost more than 58% from the April peaks to hit 19-month lows on June 18.
This trend-line resistance plus the 20 Exponential Moving Average has halted buying momentum within the past few months. Bears were yet to surrender to bullish influence despite the latest bearish invalidation.
Persistent bears might see the altcoin retesting the Point of Control around the $0.105 mark. A closing beneath this mark might expose Stellar to declines towards $0.098.
The 50 Exponential Moving Average might restrict buying efforts if XLM buyers secure renewed momentum. Buyers should ensure a closing beyond the trend-line resistance to amplify the probability of this trajectory.
The RSI (Relative Strength Index) has adopted a bearish outlook within the past few days. Moreover, the midline resistance slowed short-term efforts by buyers on the price chart.
Furthermore, the A/D’s (Accumulation/Distribution) higher highs within the previous two weeks created a bearish divergence with XLM price.
This outlook matched the current pessimistic picture for the alt. However, traders will have to look for a bullish twin high pattern before executing calls if the Awesome Oscillator secures a closing beyond the zero level.
Considering the past price rejections around the 3-month trend-line resistance, Stellar (XLM) might witness sluggish periods near its Point of Control. A closing beneath $0.105 would clear the patch for shorting opportunities. Price targets would stay as mentioned above.
Nevertheless, XLM enthusiasts should evaluate the broad market outlook plus on-chain activities for profitable moves. Such an approach remains crucial to minimizing the risks of bearish invalidations.
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