Stellar (XLM) has been on a slow but steady climb since the start of the year. It was even able to break out of an extended descended resistance line that had been in place since its all-time high. This gave it a chance to move up to the $0.105 resistance area. Unfortunately, though the price quickly declined after its failure to break above it, making a bearish engulfing candlestick.

To provide a more in-depth assessment of the situation, the Relative Strength Index (RSI) of both the weekly and six-hour charts are utilized. On the weekly chart, the RSI reading provides bearish indication as it is below 50. Whereas, on the six-hour chart, the RSI has fallen even further to below the 50 mark.

Technical analysis from the daily timeframe aligns with the bearish outlook indicated by the RSI. It points the formation of an ascended parallel channel after the breach of the resistance line. The price dropping back within the channel is seen as an indication of weakness since it could not sustain the breakout. Adding on to this, it appears to be a completed A-B-C corrective structure, implying a bearish trend.

The most likely outlook therefore is that the price of XLM will drop to the support line at $0.080 near the indicated support area at an average price of $0.076. This bearish outlook of the Stellar (XLM) price will be nullified if it can succeed to break out of the channel and transcend the $0.105 resistance area. In that case, it will be likely to move up to the next resistance at $0.150.



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