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XLM Technical Analysis - Fundamental Upgrades Paint Bullish Picture

Updated: Jul 25, 2024
Published: Jun 12, 2019
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Stellar is one of the projects that has been in the public eye for a while. The platform has managed cross-asset transfers successfully (even with fiat-based currencies) and now they are focused on expanding its services to cross-platform transactions. All in all, the 11th coin by market capitalisation has performed outstandingly during the last couple of months, gaining over 116% in less than 4 months.

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If we breakdown the daily timeframe, from January 2019 to date, price action has followed an oscillatory movement. XLMUSD fell 41.45% during January and the end of February, but price rejected the $0.073 support zone significantly, spiking over 113% in the first fifteen days of May. Bulls failed to break the $0.1618 resistance and have lost around 27.40% since then.

On the 1D timeframe, similar to other altcoins,  XLM price has formed a descendent wedge. Lower lows and lower highs have been present since May 16th. Price action has tested the ascending trendline on three occasions with bulls unable to break the pattern.  

Taking into account the previous analysis, there are currently two possible scenarios. If PA manages to close above the $0.1311 area, then the descending wedge would become invalid and the next possible upside movement would have the potential of reaching the $0.1611 liquidity zone (upper purple area). This is a very important resistance zone, so traders will be closely following PA reaction. The second scenario would be a  bearish breakout. If bears push the price below the $0.1173 support (lower purple area), then there will be more room a fall, with next resistance being the $0.095-0.0885 demand zone.

Another positive factor to highlight is that the Stellar volume increased from $168 million by the end of February to $430.23 million USD in June, boosting its upside momentum.  Currently, XLM's market cap is $2.4 billion and 24H volume is being kept above $400million.

There are a few events that traders must place in their calendars. Before the 30th of September, XLM’s team has scheduled the release of the Q2 protocol as well as important improvements in their well-known Kelp Bot and some decentralisation features.  Also, during this quarter, Q3 and Q4 protocols will be experiencing significant upgrades that can push the price higher if they turn out to be successful.

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