Stellar (XLM) coin price soars 30%, here's why!

Bittime - Stellar's XLM coin recently recorded a 30% price increase, marking a significant recovery after a period of downtrend that sapped investor confidence. 

This momentum presents a new opportunity for Stellar to continue its bullish trend, with support levels getting stronger. But what are the driving factors behind XLM's price surge?

With stability beginning to take shape, investors are now considering the long-term prospects of the XLM coin. Here's a detailed analysis of the main causes of the price increase, the challenges faced, as well as future predictions for Stellar.

Recovery from Downtrend

Stellar has managed to break out of the month-long downtrend that had depressed the price of this digital asset. 

This recovery was influenced by a number of factors, including increased market interest in XLM and support from investors who remained optimistic despite previous uncertainty.

The positive funding rate that persisted during the correction period was one of the important indicators that showed investors' confidence in Stellar's rebound potential. This optimism provides a solid foundation for the XLM coin to continue its recovery towards higher price levels.

Also read: Stellar (XLM) Price Prediction: Can it Break $2?

Market Sentiment and Investor Challenges

In terms of market sentiment, Stellar's Chaikin Money Flow (CMF) indicator is around the zero line. This indicates weak capital inflows, signaling uncertainty among investors. 

This uncertainty is a challenge that must be overcome to maintain the upward momentum of the XLM coin price.

Stronger capital inflows are necessary to support Stellar's price movement to higher levels. Otherwise, there is a risk that the XLM coin price could correct again, especially if the broader market experiences bearish pressure.

XLM Funding Rate. Source: Coinglass

XLM Stellar Price: The Next Target

Currently, Stellar's XLM coin is trading at around $0.429, with a strong support level at $0.416. To continue this rise, Stellar needs to break the resistance level at $0.583. 

If successful, this will strengthen the bullish outlook and increase investor confidence in the long-term growth of this digital asset.

However, if the XLM price falls below $0.416, there is a possibility that the coin will correct further to reach $0.355. This scenario shows the importance of maintaining positive sentiment and market support to sustain the existing bullish momentum.

Also read: Stellar (XLM) Market Cap Starts to Approach Shiba Inu (SHIB)

Stellar's Long-Term Outlook

Stellar's XLM coin price recovery of up to 30% signifies the great potential for this digital asset to continue to grow. 

With investor support and increased capital inflows, the XLM price has the opportunity to continue its significant rise to higher levels. However, investors should remain wary of challenges in the broader market.

Stellar's success in defending critical support levels will be key to the next price movement. For XLM coin enthusiasts, this is an exciting time to keep a close eye on market developments and take strategic steps in their investments.

FAQ

What caused Stellar's XLM price to increase by 30% recently?

Stellar's XLM coin price surged thanks to the recovery from the downtrend, positive support from investors, and increased market interest in this digital asset.

Can Stellar's XLM price continue to rise?

Yes, if Stellar manages to hold the support level at $0.416 and break the resistance at $0.583, there is a good chance that the XLM price will continue to rise.

What are the main risks facing Stellar right now?

The main risks are market uncertainty and weak capital inflows. If market conditions worsen, XLM price could correct below critical support levels again.

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References

beincrypto.com, Stellar's (XLM) 30% Surge Is the Result of These Traders' Perseverance, accessed on January 13, 2025.

Author: AWW