The price of Bitcoin has once again risen above $29,300 as of the time of writing this article. So, what will happen to the price of XLM Coin? While investors fear further declines in the king of cryptocurrencies, BTC is reinforcing its price support. This situation could lead to significant increases in many cryptocurrencies, including XLM Coin.
Stellar (XLM) Coin Analysis
The XLM price has declined since reaching its highest point of the year on July 13. However, we may soon see a breakout within a short-term formation. Despite the decline, the weekly trend continues to be positive. Furthermore, a breakout from the short-term symmetrical triangle will confirm the upward trend.
The weekly timeframe technical analysis of XLM reveals several important developments. One of these is the breakout that occurred at the beginning of January, where XLM surpassed the descending resistance line that had been in place for 616 days.
Following this breakout, XLM formed a higher low and confirmed the previous resistance line as a support level. This led to a new upward movement that gained momentum in June.
XLM Coin Price Target
Stellar (XLM) Coin successfully surpassed the horizontal resistance zone at $0.105 but failed to reach the next resistance at $0.23. Instead, its upward trajectory stalled at $0.195, forming a significant long upper wick. These wicks are considered signs of selling pressure, often preceding downward movements.
After reaching this high level, XLM experienced a decline over the next three weeks, gradually approaching the support area at $0.105. According to Elliott Wave Theory, XLM Coin is likely nearing the end of the fourth wave within a five-wave upward sequence. This fourth wave has taken the form of a triangle formation, which is the most commonly observed formation at this stage of the wave cycle.
If this analysis is correct, it indicates that XLM has potentially reached a local low point and is currently in the process of confirming the support line within the triangle formation. Additionally, this suggests that XLM is nearing the end of its consolidation phase.
In conclusion, it is expected that XLM will break out of the triangle formation and embark on an upward movement towards the long-term resistance level at $0.23. This projected increase represents a gain of slightly over 60% from the current price point. On the other hand, in the event of a reversal scenario, a downward movement towards the next support level at $0.09 would occur. This would equate to a decrease of approximately 35% from the current price.