XLM Price Prediction: Stellar resumes uptrend after bouncing off key technical pattern

Stellar has printed a double-bottom pattern, leading to gains above $0.36.
The MACD is likely to flip bullish in the short-term as XLM momentum becomes stronger.
The 4-hour SuperTrend indicator recently sent a signal to short Stellar, casting a bearish cloud.

Stellar plunged to levels around $0.34 before the ongoing recovery came into play. The entire cryptocurrency market has been on a downtrend this week. However, minor gains can be witnessed across the board on Friday, with cryptoassets such as XLM rebounding from crucial support levels.

Stellar makes a comeback from weekly lows

The cross-border token has been on an upward roll following the formation of a double-bottom pattern. This is a highly bullish technical pattern that forms after an asset hits a particular anchor zone a couple of times, separated by a peak.

The double-bottom pattern is confirmed in technical analysis when the asset bounces off the support area. Its recovery is characterized by increased trading volume. It is crucial to wait for the confirmation of this pattern to avoid false breakouts.

Stellar is likely to continue with the uptrend as long as the support at the double-bottom holds. Note that gains above the 50 Simple Moving Average (SMA) on the 12-hour chart could trigger massive buy orders as XLM heads back to $0.6.

XLM/USD 12-hour chart

The Moving Average Convergence Divergence (MACD) indicator hints that recovery could stay intact in the near term. However, the uptrend will be validated by the MACD line (blue) crossing above the signal line on the 4-hour chart.

XLM/USD 4-hour chart

Looking at the other side of the picture

The SuperTrend indicator has recently flashed a sell signal on the 4-hour chart. This call to sell occurred when the indicator flipped above the price and turned red. Traders use the SuperTrend indicator to foresee the general direction of the asset. If the situation remains the same, Stellar may start retreating to the support at $0.34 and $0.3, respectively.

Share: Cryptos feed

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.