The XLM price has pulled back -14% over the last two days. The recovery is quickly losing momentum and in danger of reversing.
The cryptocurrency market has bounced sharply from last week’s devastating losses. A +70% rally in a week may seem incredible. However, the fact remains that Lumens is still half the price it was two weeks ago.
The XLM price is currently trading at $0.4111 and -14% lower than Wednesday’s $0.4700 high.
The low trade of $0.3000 during the May 19th crash represented a -62% decline from the $0.7978 high a week before. The magnitude of the decline enticed buying at the lower end of the day range. XLM staged an intra-day recovery, bouncing +76% to $0.5350.
This led many to believe the worst was over. However, that was not the case, and again, the market reversed sharply. Only this time, the sell-off took the XLM price even lower.
Early Sunday, the Lumens price traded as low as $0.2700. Similar to Wednesday’s decline, Sunday’s was also followed by a relief rally.
This rally may also be starting to reverse. Could XLM be once again heading south?
The 2-hour chart shows that the recent bounce failed at $0.4700, the 0.382% Fibonacci retracement from the ATH.
Since that failure, XLM has found support at $0.4040. This level is now being tested. Should the market fail to hold this level, there really isn’t much in the way of support until Sunday’s low -32% below the current price.
Additionally, the MACD momentum indicator has also turned lower. This is another bearish development for the price.
The negative outlook is dependent on the XLM price breaking below support. Of course, there is no guarantee that will happen.
Should the price consolidate above support, It can then move higher to resistance at $0.4700. A break of which, would suggest the rally remains intact.
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