Stellar (XLM) Shows Reluctance to Scale Towards Its Resistance!
XLM is the native token of Stellar Lumens, an open-source, decentralized payment network that aims to build a fast and efficient payments system that can create dominance in the market. The primary advantage of Stellar is its use of XLM tokens as a transaction fee, which is kept minimum for consistent growth.
There have often been arguments for marking this transaction free, but the chances of spam items and arbitrary data overpowering the database system are the real challenges. XLM currently has a net supply volume of 50,001,787,643. Initially, the volume was over 100 billion tokens with a 1% annual increase. However, this system was curbed after a community vote in 2019.
The blockchain grew tremendously from January 2020 to May 2021 based on the XLM token valuation during the golden cryptocurrency period. Returning to its pre-breakout levels of 2020 indicates that the market didn’t perform as expected. It might also be possible that the re-opening of the world economy after the pandemic has negated the need to use decentralized payments networks for the time being.
Stellar has shown a negative price trend with more emphasis on consolidation. There has been decent volatility recently, but the price action barely scratches the surface. Read Stellar price prediction to get a detailed view of how the token is forecasted to perform in the future.
The short-term hourly price action can help traders plan their movements in short holdings. The sudden profit booking activity seen on July 24 pushed the value from its weekly highs. The dip in momentum has brought the prices of XLM on the verge of a breakdown on hourly charts.
The action has been seen as consolidative in nature for the last week. Despite a rising buying sentiment, the Stellar prices have either failed to sustain a high value or succumbed to profit booking at regular intervals. The bearish crossover initiated yesterday will have strong control over the negative tendency of XLM. Breaching the $0.1091 mark can push the price further below its immediate support level of the $0.1000 mark.
The technical indicator for Stellar has now turned highly bearish, which can be disastrous for the buyers who have been hoping for a breakout since July 18.
Weekly charts of XLM indicate a severe decline compared to January 2022 values. The negative sentiment has been weighing hard on the buyers, resulting in a dipping RSI indicator that has now touched 33.
To show strength in its momentum, Stellar has to stand above $0.2472, requiring a huge upside gain from the latest trading price of $0.1099. Since XLM has marked a bullish crossover with slight strength, the continuation of the buying trend can bring the spark back to XLM.