XLM/USD 1D Descending Triangle Pattern (Step Pyramid)
Idea
XLM/USD just completed the third iteration of a descending triangle pattern observed in this bull run. In addition, it has been quite harmonic in both the time frames and price projections in each case. Because of this harmony, it is creating somewhat of a step pyramid giving excellent indications of ideal buying opportunities.
Price Structures
Descending Triangle 1
Structure Apex: 25 Nov '20 @ 0.2300
Structure Base: 23 Dec '20 @ 0.1111
Descending Triangle 2
Structure Apex: 06 Jan '21 @ 0.4371
Structure Base: 11 Jan '21 @ 0.2043
Descending Triangle 3
Structure Apex: 13 Feb '21 @ 0.6093
Structure Base: 25 Mar '21 @ 0.3477
Conclusion
The difference between the high and the low (using closing prices) of the most recent descending triangle pattern base was roughly 21 cents. Adding this amount to the top of the step (56 cents) gives an estimated future level of 77 cents. However, the value of each one of these “steps” have been increasing by a 1.5x multiple each cycle. If we were to factor this in, a more realistic price prediction in the near term would be about 86 cents (56 cents + (21 cents * 1.5)). Lastly, the time frames here are quite interesting in the fact that from a new high to a “step” break has been on average about 45 days.
XLM/USD just completed the third iteration of a descending triangle pattern observed in this bull run. In addition, it has been quite harmonic in both the time frames and price projections in each case. Because of this harmony, it is creating somewhat of a step pyramid giving excellent indications of ideal buying opportunities.
Price Structures
Descending Triangle 1
Structure Apex: 25 Nov '20 @ 0.2300
Structure Base: 23 Dec '20 @ 0.1111
Descending Triangle 2
Structure Apex: 06 Jan '21 @ 0.4371
Structure Base: 11 Jan '21 @ 0.2043
Descending Triangle 3
Structure Apex: 13 Feb '21 @ 0.6093
Structure Base: 25 Mar '21 @ 0.3477
Conclusion
The difference between the high and the low (using closing prices) of the most recent descending triangle pattern base was roughly 21 cents. Adding this amount to the top of the step (56 cents) gives an estimated future level of 77 cents. However, the value of each one of these “steps” have been increasing by a 1.5x multiple each cycle. If we were to factor this in, a more realistic price prediction in the near term would be about 86 cents (56 cents + (21 cents * 1.5)). Lastly, the time frames here are quite interesting in the fact that from a new high to a “step” break has been on average about 45 days.
Comment:
For those of you who are still long XLM, the red downward trend line in this chart (13 Feb '21 to 22 Jun '21) met the blue horizontal trend line which coincides with 20 cents on 22 Jun '21. Since then, we have been trading sideways and 20 cents seems to be the "line in the sand" for the downside at the moment. Probability favors a retest of this level accompanied with some heavy volatility.