Stellar (XLM), the cryptocurrency powering a decentralized platform for financial transactions, has experienced a significant pullback of 25% from its recent highs. Despite this correction, the token remains a staggering 390.5% higher than its levels three weeks ago, largely driven by the broader cryptocurrency market’s bullish momentum, particularly Bitcoin’s surge.
A Stellar Performance
XLM’s recent rally has been nothing short of spectacular. Between November 4th and 24th, the cryptocurrency soared by a remarkable 608%, showcasing exceptional growth for an asset with a $14.3 billion market capitalization.
Technical indicators further solidify the bullish sentiment surrounding XLM. The CMF (Chaikin Money Flow) indicator has remained above the +0.15 level since November 6th, signaling substantial capital inflows. Additionally, the MFI (Money Flow Index) has yet to signal a bearish divergence on the daily chart, suggesting that the current pullback could be a healthy correction.
Liquidation Risks and Potential Support Levels
However, the recent surge in XLM’s price has led to a significant accumulation of long positions. As a result, a potential liquidation of these positions could exert downward pressure on the token’s price. The $0.46 and $0.473 levels are critical support zones where a large number of long liquidations are concentrated.
Furthermore, the liquidity heatmap for the past two weeks highlights two key zones that could influence XLM’s price movement. The closer liquidity pool, ranging from $0.533 to $0.55, could provide resistance to further upside. On the downside, the $0.4 level and the $0.463 level are potential support levels where XLM could find a bottom.
While XLM has undergone a significant correction, its long-term bullish outlook remains intact. The cryptocurrency’s strong fundamentals, coupled with the overall bullish sentiment in the cryptocurrency market, positions it for potential further upside. However, investors should remain cautious and monitor the market closely for any signs of a deeper correction.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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