With a market capitalization of $13.27 billion, Stellar Lumens’ value has also been rising in time. The eleventh-largest digital asset in terms of market cap has been noting a strong surge in its value, especially in the past few days. Between 10 April and 11 April, XLM witnessed a 36% surge that pushed its price from $0.5713 to $0.6550. However, the price retraced 12% and was now being traded at $0.5827.
Stellar Lumens 1-hour chart
Source: XLMUSD on TradingView
The above chart of XLM indicated that the surge in the market peaked at $0.6550, after which it began correcting. The price plunged within two consecutive descending channels and was currently supported at $0.5757.
This downtrend has been hinting at another drop making its way into the XLM market.
Reasoning
After the rapid movement in terms of price action, the volatility has left the market as the Bollinger Bands converged. The falling price has contributed to the dropping volatility in the market. While the signal line has moved above the candlesticks indicating the price was trending lower.
Meanwhile, the relative strength index was close to the equilibrium zone at 48. However, the rising bearish momentum could result in the rise of selling pressure and push the XLM value further down. This could be possible if XLM breaches the support at $0.5757.
Crucial levels
Entry-level: $0.5700
Take Profit: $0.5491
Stop-level: $0.5840
Risk to Reward: 1.49
Conclusion
The current Stellar Lumens chart noted the wave-like movement of the coin. Although the price witnessed a strong uptrend, the correction has finally set in. The price has slumped within two descending channels, and if it breaches the immediate support, we may be looking at the value go as low as $0.5491. However, if the buying pressure rises, the breakout from the pattern can be bullish and could retest the resistance at $0.6103.
