Stellar is facing one of its steepest corrections in weeks, plunging 10.84% in the last 24 hours to trade at $0.4168. This has come after logging a 7-day gain of over 12%, and eyeing a golden cross. Amid panic-driven activity, the trading volume surged 71.56% to $1.02 billion.
While XLM rallied earlier this month on optimism and stablecoin adoption news. The current breakdown below critical levels has been nerve-wrenching to hodlers. So, can the bulls hold the line at $0.40, or is a drop toward $0.33 inevitable? Join me as I decode the ins and outs of XLM in this analysis.
On-Chain Metrics Show Risk of Long Liquidations
According to the XLM Total Liquidations Chart by CoinGlass, July has seen a dramatic increase in liquidation between July 11–17. This is when short and long positions both saw spikes, suggesting heightened volatility. The latest surge in long liquidations near $0.40 indicates traders overleveraged during the July rally and are now being flushed out as the price slides.
That being said, the fear of liquidation spikes mounts near the $0.40 zone. This is where over $79.8M in long positions are at risk compared to $42.1M in shorts. This, coupled with an 11.63% fall in open interest, shows many traders are now reducing exposure.
XLM Price Analysis:
Technically speaking, XLM’s structure has weakened after failing to hold above the 23.6% Fibonacci retracement at $0.44 and the 30-day EMA around $0.41. Currently trading at $0.4074, Stellar has dropped below the lower Bollinger Band, and the RSI has plunged to its oversold territory at 28.14.
Support at $0.40 is now critical. If broken, the next key zone lies at $0.3171, which aligns with the 61.8% Fibonacci retracement from July’s rally. On the upside, bulls must reclaim the XLM price at $0.44 and $0.47 to reverse the downtrend.
FAQs
Broader market pressure, technical breakdowns, and large-scale long liquidations are impacting the XLM price.
Yes, with the RSI at 28.14, which is below the typical oversold threshold of 30, XLM is oversold right now.
The immediate support for XLM is at $0.40. A breakdown could trigger a drop to $0.33. Resistance lies at $0.44 and $0.47.
