XLM has been a falling knife for two years with no sign of a bottom. XLM has been stuck under a descending trend line that it last tried to penetrate unsuccessfully last June during our bull run. XLM was one of the few that saw an additional rally in Nov 2019 and then saw its low .04 in the middle of December around the exact same time that BTC put its low in. This low also confirmed a descending channel that was on a direct collision course to penetrate the descending trend line and possibly push XLM above the descending trend line after two years of successful repression.
We formed a descending pennant/wedge and a channel where we broke up out of the pennant and the 2 year descending trend line around 5.Feb. Now we are stuck at the top of our newly formed channel. It feels like there is a good chance we could pull back to .06cents to validate the top of channel as support before heading back up to break the channel but also the way Crypto has been running, it may not look back.
-We know there is fairly strong correlation between XLM and BTC so it is likely BTC that will determine the overall outcome. If BTC breaks $10,600, there is a good chance we see it run to 14k. BTC still has a lot of room to do a perfectly healthy pull back. Overall sentiment and trend for BTC is quite bullish. The price of BTC is currently the #1 technical indicator for XLM so keep an eye on it.
-if we stay in channel, sink back below the trendline and continue descent. Look for a break back under the 2 year descending trend line (around .06cents) as a fairly strong sell signal with bottom of channel being a fairly strong buy signal (Around .036). We just broke out, upward from a fairly large year long descending wedge, we broke out exactly in the area one would expect a wedge to break out. Because of this, it seems more likely that XLM, along with its flourishing relationship with IBM will continue to run higher. Expect some turbulence in the price points outlined - our next resistance at .092, but it’s a fairly light resistance, breaking it should see next resistance around .13 & .14 cents a nice 100% gain from today's price. If we beat out that .14 cent mark, there is a potential for a hiccup around .20 and then significant resistance around $.25 cents, about 350% gains from today’s price but still a long way from its ATH of almost $1.00.
This is not investment advice, its merely observations I have made in my efforts to do my own research. You should always DYOR!
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