Stellar [XLM] has seen a slight pullback in its recent gains, trading at $0.4255 currently. This marks a decrease of 0.96% in the last 24 hours and a 9.09% decline over the past week.
With a total supply of 30 billion XLM, the cryptocurrency holds a market cap of $12.79 billion.
Despite the recent short-term setback, analysts are looking at historical data and recent technical signals as reasons to keep a close eye on the asset.
Potential Upside Indicated by Technical Indicators
Recent technical analysis indicates that Stellar has encountered a “golden cross” scenario, where its 13-day moving average (red) surpassed the 49-day moving average (yellow).
This pattern is commonly viewed as a bullish sign, suggesting the potential for upward momentum. However, XLM’s price has fallen from its peak of $0.60 in November, stabilizing around $0.42.
There is visible support around the $0.33 mark, close to the 49-day moving average, where buyers might intervene if the price continues to retreat. The Relative Strength Index (RSI) currently stands at 52.40, indicating a neutral momentum.
Buyers have shown activity after the RSI cooled down from overbought levels in November. Analysts propose that as long as XLM stays above $0.33 to $0.42, there is a possibility of a recovery towards $0.45 or higher.
Optimism Backed by Historical Trends for Future Expansion
Examining past performance sheds light on XLM’s potential price trajectory. In the bull market of 2020–2021, Stellar surged from around $0.025 to $0.79, marking a significant gain of 3,162.88%.
Analysts have pointed out the likelihood of a similar rise from current levels. Forecasts suggest a push towards $2.19, with a further target of $2.27, contingent on broader market conditions and investor confidence.
Crypto analyst EGRAG CRYPTO has drawn parallels between this potential uptrend and historical price movements, stating,
“We’ve just tapped into the Mouse’s Whiskers, and now it’s time to gather momentum!”
EGRAG emphasized the importance of retesting crucial exponential moving averages (EMAs) as XLM aims to surpass higher resistance levels.
Mixed Market Sentiment Signals
Recent data from Coinglass reflects a 30.20% decline in trading volume, currently at $614.82 million, along with a 4.89% reduction in open interest, indicating subdued market activity.
Despite this, the long/short ratios on Binance (2.2258) and OKX (1.77) exhibit a bullish bias among traders, with the top traders on Binance favoring long positions at a ratio of 2.3378.
Liquidation data shows a total of $621.13K liquidated in the last 24 hours, with long positions dominating at $552.63K, signaling risks of excessive leverage.
On the other hand, spot market figures disclose $3.37 million in net outflows on December 13th, indicating a continued exodus of funds from exchanges.
Such outflows often suggest accumulation by investors, potentially alleviating selling pressure on XLM.
Despite recent price dips, the combination of historical data, technical indicators, and ongoing accumulation trends hints at the potential for a renewed surge in XLM’s momentum.