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- Stellar (XLM) sees a price drop, but trading volume surges, indicating strong investor interest.
- Despite the recent price decline, increased trading volume suggests potential for a market rebound.
- RSI at 33.94 signals XLM may be undervalued; MACD shows bearish momentum with dominant selling pressure.
Stellar (XLM) is currently trading at $0.2911, with a price decrease of 4.98% in the 24 hours. In spite of the decline, the trading volume has increased by 72.24% and now stands at $196.58 million. The growth in volume is a sign of high interest for investors, despite the decline in price.
Source: CoinMarketCap
In the last seven days, XLM has declined by 10.6%. Nonetheless, the increase in the trading volume indicates that the participants in the market are active. The large volume could mean that investors are preparing for a possible rebound.
XLM Faces Critical Support Test for Potential Rebound
Analyst Jonathan Carter highlighted that Stellar (XLM) could potentially breach the lower boundary of a bullish flag configuration on the weekly chart. It is a very vital support level, and buyers tend to rush into the market to avoid further deteriorations. If this support holds, XLM could potentially see a price bounce. The analyst believes that the price can tend towards the resistance of $0.33, $0.47, and $0.57.
Source: X
Carter also pointed out the significance of this support test in the future course of the XLM price. He observed that the current fall in the price would result in more declines in case of a failure to maintain the support. Nonetheless, in case the trend persists, it may be indicative of a buying opportunity.
RSI and MACD Indicate Oversold Condition
The Relative Strength Index (RSI) of XLM is currently at 33.94, which means that it is oversold. An RSI that is less than 30 normally indicates an undervalued asset. This indicates that XLM could have a price correction in case of a market shift towards the buyers.
Source: TradingView
The Moving Average Convergence Divergence (MACD) indicator indicates a bearish momentum. The present MACD is -0.000263, which demonstrates that selling power is more prominent compared to the buying power. The MACD line crosses the signal line below, which also puts more evidence on the bearish perspective.
Trading Volume Surges, Open Interest Declines
According to CoinGlass data, the trading volume increased by 55.72% to $230.89 million. Open Interest, however, declined slightly at 2.31, reaching $131.20 million. The XLM OI-Weighted Funding rate is at -0.0166%, which means that the short positions dominate the market. This is an indication of the feeling of precaution, and more traders are placing bets on a further fall of prices.
Source: CoinGlass
The fall in the price of Stellar has been of concern, though the increased volume in trade indicates that there is still high interest in the market. RSI and MACD indicators have some mixed signals and some bearish pressure. Nonetheless, when the support level prevails, XLM may rebound; therefore, this is a critical period in which the traders should watch the coin intensively.
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