Although the Stellar Lumens price action is frustrating for the bulls, XLM remains in an uptrend which may offer some respite.
Despite gains across the cryptocurrency complex, Stellar Lumens (XLM) is unchanged in Sunday trading. Bitcoin is leading the charge higher in Asian hours and up over $4,000 from Fridays $53,500 Low. However, as has been the case recently, Stellar is immune to the changes in the broader market and continues to limp lower.
Considering the market as a whole has been trending broadly higher over the last few months, XLM has performed poorly. Subsequently, Stellar Lumens is dropping down the cryptocurrency league table. At the current valuation of $7.9 billion, XLM ranks the 26th-largest cryptocurrency behind play-to-earn Axie Infinity.
Friday’s erratic price action highlights the over-leverage in many assets classes. Equity markets had their worst day in over a year, and Brent crude suffered its 7th-biggest one day drop. As a result, Bitcoin sank 9% under the weight of heavy-selling, triggering steep losses across the complex. However, concerns that light trading conditions exaggerated Friday’s sell-off has brought dip-buyers out of the woodwork.
The daily chart shows the Stellar Lumens price bounced from trend support at $0.2985 yesterday. However, a short-term downtrend continues to weigh XLM down. Furthermore, the 50,100 and 200-DMA’s ($0.3620, $0.3447, and $0.3372, respectively) add to the overhead resistance.
As long as the market as whole recovers from last week’s ‘crash’, XLM should hold the rising trend support. However, traders should pay close attention to US equity markets later today. The danger for longs is a return of the negative sentiment that gripped markets towards the end of last week.
For now, the uptrend is the dominant theme. Therefore, the overall view is cautiously optimistic. However, a close below trend support at $0.2985 invalidates this thesis.
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This post was last modified on %s = human-readable time difference 02:15