The market structure and momentum of Stellar Lumens have been in a downward trend since late July, but the price chart may indicate a range formation in the past two months. Recent losses have brought the popular altcoin XLM to the lowest levels of this range. Will the bulls be able to defend this level once again?
According to experts, the specified price range extended from $0.111 to $0.1334. Stellar Lumens has been trading within this range since August 20. The four-hour chart shows a strong downward trend in market structure and the Relative Strength Index (RSI) reflects intense downward momentum with a reading of 25.
The Chaikin Money Flow (CMF) metric in the cryptocurrency also experienced a decline, and a value of -0.3 may indicate a significant outflow of funds from the market. This highlights the selling pressure. The recent high trading volume could be another sign of overwhelming downward momentum.
However, the $0.111 level could represent month-long support for XLM. According to experts, this presented a low-risk, high-reward opportunity for buying. A bounce from this level could potentially take the price to the highest levels of the $0.133 range, representing gains of nearly 20%.
The volume indicator shown on the price chart, CMF, recorded high selling pressure in recent hours. However, data from Coinalyze contradicted these findings and showed significant buying volume in the spot market. Analysts believe that the latest data was confirmed by the significant increase in spot CVD.
However, the open interest (OI) revealed that market sensitivity is strongly in a downward trend, due to both declining prices and an increase in OI. This development may indicate that short sellers are dominating the market and that if the trend continues, XLM bulls may not be able to defend the $0.11 support.