Over the past 24 hours, XLM has seen some slight consolidation. After 4 straight days of loss, the coin has managed to report a modest 2% surge. But this is still a passing cloud. In fact, the bearish outlook on XLM is stronger especially now we have seen a drop in trade volume. Here are some pointers:
XLM has seen a 28% decline over the past week
The trading volume over the same period has also declined sharply
The coin will likely continue downward for a few weeks despite the minor recovery.
Data Source: TradingView
Stellar: A bear on the loose?
It’s understandable that XLM is bearish and will remain so for at least another month. The market has not left any room for gains as most major coins continue to sell off. But the trend for XLM is quite alarming.
The coin actually saw some decent runs in May. In fact, in the run-up to June, we saw a strong relief rally for XLM that took it above several key support zones. But over the past two weeks, slowed momentum has pulled the price action down. Besides, momentum indicators, including the RSI and the Money Flow Index show a bearish reading.
But more importantly, a sharp decline in trade volume has been observed. This suggests that many investors are taking a break from XLM as they wait for the market to turn. With all these factors, XLM will continue to trend lower and may even hit a new 2022 low in the coming days.
Should you buy the XLM dip?
Well, for now, it’s best to wait. The market is yet to bottom, and even if we see a relief rally, it will be short-lived.
XLM still has another 40 – 50% downside to go. Wait for it to bottom before you jump in for the dip. This may take a few weeks to happen or even sooner.
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