Stellar (XLM) Coin: Price Analysis Based on On-Chain and Technical Data

Bittime -  Are you ready for a big opportunity? XLM, which had soared 430% after the US election results, is now facing a correction phase. But, make no mistake! The $63 million outflow from the exchange could be a good sign. 

Large investors are starting to secure XLM in private wallets, which usually indicates that they are looking forward to the next price spike. What do you think? Is XLM ready to continue its bullish journey?

Stellar Volatility (XLM)

The price of Stellar (XLM), the native token of the Stellar network, has recently experienced significant volatility. However, the latest on-chain data and technical analysis suggest that there is interesting bullish potential for XLM. 

Although the token recently underwent a price correction, signs suggest that XLM may be preparing to experience an upward price movement. This follows a massive 430% surge since the US Presidential election results, which contributed to the overall bullish trend in the cryptocurrency market.

Also read: History of Stellar (XLM): Advantages, Weaknesses and Everything You Need to Know

$63 Million XLM Outflow

One of the key developments fueling speculation regarding XLM's future performance was the outflow of $63 million in XLM from cryptocurrency exchanges. 

According to data from Coinglass, this outflow shows increasing interest from whales (large investors) and long-term investors who are moving their holdings from exchanges to private wallets. In the crypto world, this type of outflow is often considered a bullish signal because it usually indicates a decrease in selling pressure and a potential increase in buying demand.

This significant outflow marks a significant milestone for XLM, as it is the first time the token has experienced a large transfer of assets from an exchange. 

Typically, when a cryptocurrency sees a lot of tokens being moved to private wallets, it indicates that investors prefer to hold their assets in the hope of future price growth, rather than selling them.

Also read: 5 Advantages of Stellar (XLM) that You Must Know

XLM Price Correction

Despite the bullish sentiment indicated by these outflows, XLM is currently undergoing a price correction after a strong surge. The token is consolidating price in a relatively narrow range between $0.42 and $0.60. During this consolidation period, XLM price has corrected from the high point of the range towards the lower limit.

Technical analysts predict that XLM may experience a further decline of around 15%, with the possibility of touching $0.42 before resuming its upward movement. 

This is part of a natural price correction after previous spikes, which is common in cryptocurrency markets. This correction phase usually helps "filter out" weak investors and prepare the market for the next round of upward momentum.

XLM Technical Indicators

XLM's technical indicators are currently showing mixed signals, but the overall outlook remains optimistic. The token is trading above the 200-day exponential moving average (200-day EMA), which is an important indicator showing that the overall trend is still moving upwards. 

In addition, XLM's Relative Strength Index (RSI) is at 63, which indicates that this asset still has room to rise before entering overbought territory.

These technical indicators support the belief that the XLM price correction may only be temporary, with the potential for a rebound to higher levels in the near term. If the token manages to stay above the $0.42 support level, then significant upside potential could occur in the coming weeks.

Also read: Who is the CEO Founder of Stellar (XLM): Jed McCaleb's Story and Biography

Current Market Momentum

At the time of writing, XLM price is trading around $0.50, with a decline of 5.6% in the last 24 hours. This price drop was accompanied by a 62% drop in trading volume, indicating that market participation has slowed compared to previous days. 

While this drop could be a cause for concern in the short term, it could also be an opportunity for investors who believe in XLM's long-term growth potential.

Looking ahead, the combination of significant outflows from exchanges, the ongoing price correction, and positive technical indicators creates a scenario where XLM could be well positioned to experience another bullish run. However, investors should still pay attention to broader market trends and be prepared for potential volatility in the short term.

Conclusion

The $63 million outflow from the exchange is a strong indicator that long-term investors believe in the future of XLM. Coupled with positive technical indicators and recent price action, these signals suggest that XLM may soon experience a bullish breakout once this consolidation phase ends. 

However, as with other cryptocurrencies, the market remains unpredictable, and investors should remain cautious and aware of potential risks when looking for buying opportunities.

The future of XLM looks bright, but how the journey will play out depends on how XLM maintains its support levels and weathers the ongoing market correction. For now, investors continue to monitor upcoming price movements, hoping for a breakout to occur soon.

FAQ Stellar (XLM)

What is Stellar (XLM)?

Stellar (XLM) is a blockchain that enables fast, low-cost cross-border transactions, using XLM tokens to facilitate payments.

What makes XLM unique?

XLM focuses on efficient international transactions with low fees and high speed, and uses decentralized consensus.

Is XLM worth the investment?

XLM has the potential to be a long-term investment, especially if blockchain adoption for global payments continues to grow.

 

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Reference

Coinpedia, $63 Million of XLM Outflow, Bullish Signal or What?, accessed December 6, 2024.

James, XLM Records $63 Million Outflow, Indicating Bullish Potential, accessed December 6, 2024.

Author: MF