Stellar (XLM) plummeted towards the long-term barrier at $0.16 since touching the multi-year peaks in 2021. The latest downward wedge breakout offered the token of the much-essential surge to topple XLM’s long-term trend.
A decisive close beyond the short-term liquidity range (POC/ Point of Control) would have Stellar testing the southbound 20-Exponential Moving Average near $0.2. XLM traded neat the $0.1952 at this publication.
Stellar Daily Chart
XLM dropped to consolidate within the $0.19 – $0.39 price range for more than eight months after striking the $0.8 mark. The previous pessimistic run formed a downward channel on the daily chart as the token lost approximately 63.4% from November 10 to touch 13-month lows on February 24.
However, the 50-Exponential Moving Average posed a massive selling level that rejected most upside recovery trials. Nevertheless, the bullish resurgence in mid-March triggered a much-required surge that stopped near $0.24. Meanwhile, sellers cemented their sway while the 20 Exponential Moving Average shifted beneath the long-term Exponential Moving Averages.
A possible break beyond the resistance of $0.2 will emerge if buyers regain supremacy beyond the Point of Control. However, XLM would likely stay inside a constricted phase around the liquidity range before the upward break. On the other hand, a drop under $0.19 would mean delayed recoveries to the $0.2 mark.
Reasoning
The Relative Strength index secured a steady base near the 7-week support around the 36-level. A close beyond 43 remains vital in maintaining the recovery journey towards $0.2. The on-balance volume displayed bullish trend-line support within the past days amid newer price lows. The move unveiled and confirmed a bullish divergence with XLM price on 24hr scale.
Final Thought
A close past the Point of Control plus the optimistic OBV are the necessities for buyers to test and break the resistance of $0.2. However, the southbound 20-Exponential Moving Average may see the alt sliding towards the POC before a trend-shift action.
Moreover, Stellar enthusiasts should factor in broad market reactions and on-chain developments for profitable undertakings.
Feel free to share your views in the comment area below.
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