- Summary:
- The XLM price crashed back to earth in a devastating fashion over the last week, losing 62% from its high. The market has since bounced 52%.
The XLM price crashed back to earth in a devastating fashion over the last week, losing 62% from its high. The market has since bounced 52%.
In 72 hours of carnage, Stellar Lumens saw its market cap decline from over $18 billion to under $8 billion. The XLM price suffered from heavy liquidation, giving back four months of gains in three days.
The historic crash in Crypto assets was possibly the most violent on record, probably the worst many traders have witnessed, and definitely, the largest ever in terms of capital destruction.
XLM Technical Outlook
The decline in XLM to yesterday’s low of $0.3000 had pushed the price out of its recent rising channel and below two key technical indicators.
An ascending channel from the 11th of January had been a good area of both support and resistance for the XLM price. The market had bounced off the lower end of the channel six times over the last 4 months.
Additionally, the price has failed to clear the channel and retreated considerably from the upper end on 3 occasions over the same period.
More importantly, the drop pierced the 50, and 200-Day Moving Averages ($0.4891 and $0.3438).
Firstly, since the latest bull run started in November, the price has bounced from the 50-day MA three times. Each time the market has gone on to make a new multi-year high in the weeks that followed.
Secondly, the price has remained above the 200-Day since crossing it in November. Yesterday marked the first time the price broke below both indicators.
The price recovery from $0.3000 to the current $0.4505 has taken it above the 200-day and back into the rising channel.
The only barrier left to hurdle is the 50-day average at $0.4891.
Today’s price action will be crucial for the coin. If the XLM price can clear the resistance of the 50 Day average, there is a good chance that momentum chasing buyers take it higher,
Clearly, investors will be paying attention to the 200-day MA below the market. This, to me, is now major support. A failure to hold its $0.3438 level could spell trouble for the longs.
Traders may well want to sit on the sidelines until this period of price discovery plays out.
XLM Price Chart
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