TL:DR Breakdown
- Stellar Lumens (XLM) has surged over 160 percent over the past 7 days, to reach 2020 highs.
- Although this is good for long term holders, volatility remains in the extremely high levels for those looking for a new position.
- XLM is likely to see a correction before any new gains can be made.
Overview (24-hour)
XLM/USDT opened the trading period at 0.1688 USD, briefly setting a low of 0.1650 USD before rising to a high of 0.2277 USD (+34.89 percent). At the time of writing, XLM/USDT has settled around the 0.22 USD mark at 0.2235 USD, 13.8 percent above the period’s high-low average of 0.1964 USD.
The total trading volume for XLM/USDT during the trading period was 1.46 billion XLM, compared to 2.24 billion XLM during the previous trading period.
The Historical Volatility Index (HVI), measured 251.79 (extremely high) during this trading period, compared to 259.46 (extremely high) in the previous trading period.
Price Analysis
XLM/USDT opened the trading period at 0.1688 USDT before beginning its rally up to the trading period’s high. During this rally, XLM/USDT made two attempts at setting a high, the first being as rally up to 0.199 USD, just as a fraction of a cent below the psychological level of 0.2 USD, before briefly correcting to the 0.17 USD mark.
The second rally broke this psychological level, reaching 0.2178 USD, but again briefly correcting to 0.1816 USD. Finally, XLM/USDT went on to set the period’s high of 0.2278 USD. It is also worth noting that the XLM/USDT chart seems to have formed a rising wedge pattern.
At the time of writing, XLM/USDT has settled at 0.2235 USD, just half a cent below the trading period’s high.
Volume Analysis
XLM/USDT entered the trading period with a trading volume of 40.63 million XLM, with a mean value of 44.02 million XLM carried over from the previous trading period. There was an immediate spike in volume to 102.11 million XLM as XLM/USDT began its first attempt to set a new high.
The second attempt was matched with an even greater spike, with a trading volume reaching 127.59 million XLM. At the time of writing, XLM/USDT’s trading volume rests at 22.49 million XLM with a mean value of 36.85 million.
The On Balance Volume (OBV) indicator sharply rose to a peak at the beginning of the trading period before collapsing to a 48-hour low. It then oscillated between this low and the previous peak, never quite recovering.
The Accumulation/Distribution (Acc/Distr) indicator rose consistently during the trading period, with a sharp peak at XLM/USDT’s first attempt to set a new high.
Volatility Analysis
XLM/USDT entered this trading period with volatility in the extremely high levels, with HVI measuring 87.70 (extremely high). It subsequently fell significantly to a low 43.33 (extremely high) in the several hours following. At the time of writing, HVI sits at 51.72.
Price Prediction
Whilst XLM/USDT’s 7-day strong rally has turned heads and likely has traders sitting on the sidelines looking for a fresh entry, the asset’s volatility has significantly increased over that period. It remains at extremely high levels in this trading period.
Trading volume in this period has failed to support the recent rally to this high consistently. The volume indicators, OBV and Acc/Distr, suggest momentum is lacking. more information coming soon
Finally, the chart seems to have taken the form of a rising wedge, a notoriously bearish pattern. Taken together, unless there is a significant injection of trading volume, XLM/USDT is likely to playout the bearish chart pattern, making for a small correction before it sees new highs.
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