Stellar Lumens price tussles with $0.40: Can XLM punch through?

Summary:

After more than doubling in the last few weeks, the Stellar Lumens price has hit a brick wall at $0.4000., which may signal trouble for the XLM recovery.

After more than doubling in the last few weeks, the Stellar Lumens price has hit a brick wall at $0.4000, which may signal trouble for the XLM recovery. In fairness to Stellar, most of the altcoin market is treading water this morning after huge gains in several assets over the weekend. However, this has led to XLM failing to hold above the 200-day moving average, and this could be a sign the rally has stalled for now.

The Stellar Lumens price is last at $0.3750, higher by $0.0034 (0.92%) this morning as it attempts to pare the 15% loss from yesterday’s $0.4153 high. Despite weakness in the last 24-hours, XLM has gained 90% since the 20th of July, making it one of the better performing top-ranked cryptos. As a result, Stellar’s market cap has increased to more than $8.7 billion, slightly higher than Internet Computer’s (ICP) $8.5 Billion value.

Although XLM has had a ‘stellar’ performance recently, until it clears the 200-day moving average at $0.4002, the bears may question the validity of the rally. Furthermore, if the stellar price fails to climb above the threshold soon, it may reverse lower, sending XLM closer to $0.30000 than $0.40000.

XLM price forecast

Looking at the daily chart, it’s clear the 200-day moving average at $0.40002 Is a major obstacle for the price. Despite XLM trading above the average in the last three days, it has failed to close above it. Therefore, $0.4002 is the first and most significant level of resistance. And should the Stellar lumens price close above this level, $0.5000 is an achievable target for the bulls.

However, if the 200 DMA proves insurmountable, the 100-day at $0.3400 is the first support level, followed by previous resistance at $0.3070.

For now, the price action is encouraging, and the recent pullback appears to be a natural cooling-off period following the impressive gains over the last three weeks. And although I suspect the rally will resume later this week, trading volumes have been shallow, which may leave the price vulnerable to shocks in either direction. Therefore, investors should be prepared to experience volatile trading conditions soon.