Technical signals highlight risk of deeper correction as sellers dominate
Stellar’s native token, XLM, is showing weakness on the charts after slipping below a key support zone near $0.40, raising concerns that the recent rebound may lose momentum. The asset is now consolidating around the $0.39 level, with technical indicators pointing toward further volatility.
The 4-hour chart shows XLM breaking down from a descending channel in late July, only to rebound strongly from the $0.35 demand zone in early September. While this recovery initially looked promising, the token has repeatedly failed to clear heavy supply zones between $0.42 and $0.48.
The failure to sustain above $0.40 has now shifted focus back to the green demand area. If XLM closes below $0.37, traders warn the token could revisit $0.35 or even lower levels.
Market analysts say Stellar’s fundamentals, particularly growing institutional adoption, have not yet translated into price strength.
“XLM has strong backing from payments-focused partnerships, but the chart is showing distribution at higher levels. Until buyers reclaim the $0.42 zone, rallies may remain capped,” said BITX technical strategist.
BITX analysts highlighted the importance of support defense:
“The $0.35–$0.37 range is critical. As long as bulls defend this zone, we could see another attempt toward $0.42. A breakdown, however, would likely accelerate selling pressure.”
Key levels to watch
- Immediate support: $0.37–$0.35
- Major resistance: $0.42–$0.48
- Breakdown risk target: $0.32
For now, XLM remains locked in a range between strong demand and stubborn resistance. While institutional partnerships provide long-term optimism, technicals suggest near-term caution. If bulls fail to reclaim lost ground above $0.40, Stellar’s token may be forced into another retest of its lower support base.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.