Stellar (XLM) has attracted attention with its recent rally, gaining 220% and testing critical resistance levels at $0.3. This rise is taking place in a market environment where altcoin season has not yet started and could be a significant turning point for XLM.
“These significant gains in XLM reflect investor confidence, but it is wise to be cautious of overextension,” a COINOTAG analyst said.
Stellar (XLM) Rises, Tests $0.3 Resistance; Analysts Warn Overbought
XLM is up an impressive 220% in just 17 days. This rally started after a strong support level was formed around $0.08, encouraging bulls to push prices above the 200-day EMA ($0.1109).
Finally, on November 22, XLM tested the critical resistance level at $0.3. If the bulls successfully close at this level, they may be able to reach the next resistance level at $0.4 in the coming weeks, which could ignite bullish momentum.
However, it is important for investors to be careful; if XLM fails to break the $0.3 resistance, a pullback to strong support at $0.24 is possible.
The $0.3 resistance level is critical to the confidence of XLM bulls. A successful breakout of this level could allow the bull trend to continue towards $0.4. However, a drop below the support level of $0.24 could lead to a pullback to $0.17, an undesirable scenario for investors.
Interest in Stellar has soared as trading volume increased by 92.97% to $2.32 billion. This significant trading volume increase indicates strong interest among investors and traders.
Additionally, Open Interest increased by 56.83% to $174.74 million, reflecting increased market participation and large price movements expected.
The 24-hour long/short ratio for XLM is at 0.9743, suggesting that market sentiment is balanced. However, top traders on Binance are more optimistic with ratios of 1.0186% and 1.0346%, suggesting a slight bullish bias among professional participants.
While the bullish momentum appears promising, buyers are advised to carefully monitor Bitcoin’s price action and overall market sentiment before making any trading decisions.