XLM paints a buying recovery, where’s next?

XLM prices recovered after the coin pulled back on the charts over the past week. However, over the past 24 hours, XLM has gained 3.6% and managed to break above immediate resistance. The bulls are back in power, and the technical outlook for XLM paints the same sentiment.

Currently, XLM price has stabilized at the $0.121 level. Over the past few days, XLM has been forming higher highs and higher lows, which is a bullish sign for the market. If the altcoin can maintain its price momentum, the coin could be eyeing a price cap of $0.130 in the upcoming trading session. The purchasing power of Stellar is still crucial to the token.

The last time XLM price hovered around this price mark was a few weeks ago, around the end of June. A plunge from current price levels could take XLM price down to $0.114. Previously, when XLM was priced at $0.124, it encountered bearish pressure, causing Stellar Lumens to drop to $0.114.

XLM Price Analysis: Four-Hour Chart

Stellar Lumens at $0.126 on the four-hour chart | Source: XLMUSD on TradingView

At the time of writing, the altcoin is priced at $0.126. The bulls have resurfaced along with buyers in the market, which has caused XLM to turn its immediate resistance marker into a support line. Overhead resistance for XLM is now $0.127 and then $0.129.

On the other hand, the local support for XLM price is $0.119. Failure to sustain its price above the aforementioned support line could sink the altcoin to $0.114.

Given that the altcoin hit its lowest price level in 20 months in mid-July this year, Stellar Lumens has made a considerable recovery.

Stellar’s ​​trading volume has dropped on the four-hour chart, which suggests that selling power in the market is declining.

technical analysis

XLM price
Stellar is overbought on the four-hour chart | Source: XLMUSD on TradingView

The technical outlook paints an extremely bullish picture for XLM prices on the four-hour chart. The number of buyers on the XLM chart has increased dramatically.

The Relative Strength Index stalled in overbought territory, which means the asset is overvalued.

At press time, purchasing power greatly exceeds selling power. XLM price is well above the 20-SMA line.

The reading points to buyers driving price momentum in the market. Altcoins are also trading above the 50-SMA and 200-SMA, suggesting that demand for altcoins has increased significantly.

XLM price
Stellar paints buy signal on four-hour chart | Source: XLMUSD on TradingView

Stellar is capturing buy signals on its chart based on other indicators on the chart. Moving Average Convergence Divergence describes price momentum and reversals. The MACD depicts a green signal bar on the half line after undergoing a bullish crossover.

The green signal bar is associated with a buy signal for XLM. The Directional Movement Index is responsible for depicting the current price trend and the strength of the market trend. DMI is positive because the +DI line is higher than the -DI line.

The Average Directional Index (in red) is moving towards the 40 mark, which indicates that the strength of the current price direction indicates that XLM price will continue to rise in the upcoming trading session.

Related Reading: Bitcoin targets $24,000, sentiment remains stable

Featured image from StormGain, Charts from TradingView.com

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