- Stellar price action has consolidated within a triangle chart pattern that is now at its apex.
- XLM could lose more than 7% to slide below the 200-day EMA support at $0.1127.
- Momentum indicators suggest a downtrend despite growing social dominance and social volume.
Stellar (XLM) token has indicated strong volatility over the last few months, with the price action consolidating within a triangle pattern. As the technical formation fills up, XLM is likely to break below from a technical standpoint, despite social metrics indicating growing popularity.
Stellar price eyes possible losses
Stellar (XLM) price lacks directional bias, as it fills up a rather neutral technical formation. Normally, when the price fits within this chart pattern, investors must wait for a decisive break out before they can take positions. From a technical standpoint, XLM could break below the lower boundary of the triangle soon.
Currently, the Exponential Moving Averages (EMA) remain critical for Stellar price, which sits atop the 100-day EMA at $0.1203 for support while it confronts the 50-day EMA at $0.1257. The Relative Strength Index is nose-diving, hinting at falling momentum that could see XLM flip the 100-day EMA at $0.1203 into a resistance level, before breaking below the lower boundary of the triangle. A decisive daily candlestick close below the 200-day EMA at $0.1127 would confirm the downtrend for the short term.
Notably, the RSI had just signaled a call to sell when it crossed below the signal line (yellow) band. This could increase the odds for the downside if traders heed.
XLM/USDT 1-day chart
Conversely, the Awesome Oscillator (AO) continues to show promise. Over the last nine trading sessions, its histogram bars have steadily edged toward the positive region while maintaining their green tone. This points to more bulls flocking the scene, likely to inspire a new wave of bullish momentum to steer Stellar price.
For confirmation, Stellar price must break out from under the suppression of the upper boundary of the chart pattern and record a decisive daily candlestick close above $0.1389. In a highly bullish case, the gains could extend to the psychological $0.1600.
XLM growing social metrics
On-chain metrics from Santiment behavior aggregator tilt the scale further in favor of bulls, showing that social dominance and social metrics for XLM have recently found a pivot and are rising.
%20%5b01.59.27%2c%2013%20sep%2c%202023%5d-638301598441547246.png)
XLM Santiment
A rise in social dominance means the share or percentage of the coin’s mentions on crypto-based social media is increasing, relative to a pool of over 50 of the most popular projects on social media. In the same way, social volume metrics point to the amount of mentions of the coin on more than 1000 crypto-related social media channels.
With the two social metrics mirroring the token’s impressions, it tends to translate into bullish momentum, thereby favoring the upside.
Also Read: Investors bet on Stellar’s XLM as SEC comes with a vengeance on Ripple’s XRP token
Cryptocurrency metrics FAQs
What is circulating supply?
The developer or creator of each cryptocurrency decides on the total number of tokens that can be minted or issued. Only a certain number of these assets can be minted by mining, staking or other mechanisms. This is defined by the algorithm of the underlying blockchain technology. Since its inception, a total of 19,445,656 BTCs have been mined, which is the circulating supply of Bitcoin. On the other hand, circulating supply can also be decreased via actions such as burning tokens, or mistakenly sending assets to addresses of other incompatible blockchains.
What is market capitalization?
Market capitalization is the result of multiplying the circulating supply of a certain asset by the asset’s current market value. For Bitcoin, the market capitalization at the beginning of August 2023 is above $570 billion, which is the result of the more than 19 million BTC in circulation multiplied by the Bitcoin price around $29,600.
What is trading volume?
Trading volume refers to the total number of tokens for a specific asset that has been transacted or exchanged between buyers and sellers within set trading hours, for example, 24 hours. It is used to gauge market sentiment, this metric combines all volumes on centralized exchanges and decentralized exchanges. Increasing trading volume often denotes the demand for a certain asset as more people are buying and selling the cryptocurrency.
What is funding rate?
Funding rates are a concept designed to encourage traders to take positions and ensure perpetual contract prices match spot markets. It defines a mechanism by exchanges to ensure that future prices and index prices periodic payments regularly converge. When the funding rate is positive, the price of the perpetual contract is higher than the mark price. This means traders who are bullish and have opened long positions pay traders who are in short positions. On the other hand, a negative funding rate means perpetual prices are below the mark price, and hence traders with short positions pay traders who have opened long positions.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Turn off Solana and win $400,000 - Solana Foundation executive announces offer
Solana has been touted as an Ethereum killer, but as with every blockchain in the crypto market, the network does not come without its fair share of issues. While many who get hacked or exploited deal with the issues after the fact, Solana intends to get a step ahead by making a very lucrative offer to white hat hackers.
Grayscale vs. SEC deadline: Commission faces a midnight Friday deadline to challenge August 29 loss
Grayscale Investments secured a resounding victory in its longstanding case against the US Securities and Exchange Commission in late August. The lawsuit started in October after the firm approached the D.C. Circuit Court pushing to have its Bitcoin Trust converted to an Exchange-traded fund.
Loom Network price hits strong weekly resistance after 32% surge as LOOM ranks high on Korea’s Upbit
Loom Network token is highly bullish, passing as a rather lucrative investment for scalping traders, buying and selling the asset within a short period to make small profits.
Voyager founder charged by CFTC for fraud and by FTC for misleading investors that lost $1 billion
Voyager was among the first crypto companies to collapse and file for bankruptcy in 2022. While the platform has been making efforts to return its customers' assets since then, it looks like the regulatory bodies are not willing to be patient.
Bitcoin: Can BTC bears challenge crypto’s 2023 bull rally?
Bitcoin (BTC) price is at a critical juncture in the weekly time frame, where bulls and bears are battling for control. However, a multi-time-frame analysis shows that BTC is bullish daily and is likely to rally higher.