XLM price teeters on the edge of an 85% breakout
- XLM price has been consolidating under the $0.39-to-$0.43 supply zone for nearly a month.
- This coiling up is likely to result in an explosive breakout that pushes Stellar to $0.71.
- A breakdown of the $0.31 support level will invalidate the bullish thesis.
XLM price has been on a massive consolidation phase since October 16 as it failed to shatter an overhead barrier. Stellar is currently making a run at this hurdle and indicates that a breakout will result in an explosive breakout.
XLM price ready to make a move
XLM price has been stuck below the $0.39-to-$0.43 supply zone for 24 days with no signs of breaking out. However, Stellar has bounced off the $0.36 support level and created a higher low, signifying a continuation of an uptrend while the remittance token gets squeezed.
Therefore, investors can expect this development to resolve in a way that sends the XLM price flying higher. A confirmation of this will arrive after Stellar bulls produce a daily close above $0.43.
This move will open the path for XLM price to retest three crucial hurdles – $0.50, $0.59 and $0.71. If the bullish momentum allows the Stellar market value to retest $0.71, it will constitute an 85% gain from the current position.
XLM/USDT 1-day chart
On the other hand, if XLM price fails to breach past the $0.39-to-$0.43 resistance area, it will retrace back to the immediate support floor at $0.36, where it could give the uptrend another try. The same can be said if the remittance token retests the following demand barrier at $0.31. However, a breakdown of the said level will create a lower low and invalidate the bullish thesis for XLM price. This move could potentially trigger a further crash to $0.25.
Author
Akash Girimath
FXStreet
Akash Girimath is a Mechanical Engineer interested in the chaos of the financial markets. Trying to make sense of this convoluted yet fascinating space, he switched his engineering job to become a crypto reporter and analyst.
