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Stellar Lumens (XLM) faces a critical test as it struggles to surpass the $0.50 resistance level amid increasing outflows and weakening momentum indicators.
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The Chaikin Money Flow (CMF) indicator shows declining buying pressure, yet remains above zero, indicating that inflows still slightly outweigh outflows for now.
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According to COINOTAG analysis, if XLM fails to break through $0.50 and outflows persist, the price may retest support levels at $0.43, $0.41, or potentially drop to $0.35.
Stellar Lumens (XLM) price drops 7% as it fails to break $0.50 resistance; weakening momentum and outflows may push it toward $0.35 support levels.
Stellar Investors Are Pulling Back Amid Bearish Momentum
The recent technical indicators for Stellar Lumens reveal growing bearish sentiment. The Parabolic SAR positioned above the candlesticks signals a strengthening downtrend, making it challenging for XLM to overcome the pivotal $0.50 resistance. This suggests that sellers are gaining control in the short term.
Nevertheless, the presence of an active Golden Cross offers a counterbalance. This bullish signal, formed when a short-term moving average crosses above a long-term moving average, typically forecasts sustained upward momentum. It may provide critical support to temper the current decline and prevent a sharper drop.
XLM Golden Cross. Source: TradingView
Overall, the mixed technical signals reflect a market at a crossroads, where investor confidence is wavering but not yet decisively bearish.
Chaikin Money Flow Signals Waning Buying Pressure
The Chaikin Money Flow (CMF) indicator, which measures buying and selling pressure over a specified period, recently peaked at an eight-month high, signaling strong inflows and bullish sentiment. However, the CMF has started to decline, indicating that the buying momentum is fading.
Despite this downturn, the CMF remains above zero, meaning inflows are still marginally exceeding outflows. Should the CMF fall below zero, it would confirm a shift toward dominant selling pressure, likely exacerbating downward price movement for XLM.
XLM CMF. Source: TradingView
Traders should monitor this indicator closely, as a sustained drop below zero could signal a more pronounced bearish phase.
XLM Price Can Bounce Back with Renewed Inflows
After a 7% decline in the past 24 hours, XLM is trading near $0.45, consolidating just below the $0.50 resistance. This consolidation phase reflects uncertainty among investors as the altcoin struggles to regain upward momentum.
If selling pressure continues to dominate, XLM risks breaking below key support levels at $0.43 and $0.41, which could open the door to a deeper correction toward $0.35. Such a move would represent a significant setback for the altcoin’s recent rally.
XLM Price Analysis. Source: TradingView
Conversely, a recovery in inflows could stabilize the price and enable XLM to challenge the $0.50 resistance once again. Successfully breaching this level would invalidate the current bearish outlook and could propel the price toward $0.56, signaling a potential trend reversal.
Conclusion
Stellar Lumens is currently navigating a critical juncture, with technical indicators presenting a mixed picture. While bearish momentum is gaining traction, the presence of bullish signals like the Golden Cross and positive CMF readings suggest that a reversal remains possible. Investors should watch key resistance and support levels closely, as the next moves will likely determine XLM’s short-term trajectory. Maintaining vigilance on inflows and outflows will be essential for anticipating potential price rebounds or further declines.
