Cryptocurrency News – Stellar Lumens (XLM) suffered a disappointing 8% drop following the highly anticipated “Real World” campaign launched in partnership with actor Idris Elba. The Stellar community has been eagerly awaiting this announcement for more than 10 days. The initiative, which aims to highlight notable Stellar ecosystem projects such as the International Rescue Committee's transparency initiatives, apparently had the perfect face with Elba. However, the market's reaction seemed to be in line with the 'sell the news' principle.
Why did XLM crash?
Stellar Lumens (XLM) recently experienced a significant price crash. This downward move was largely attributed to the market's reaction to an anticipated announcement. The community had been excited for days, with many eagerly awaiting news that they hoped would be a positive catalyst for the price.
However, when the details were finally announced, the rising expectations were not met. This stark contrast between expectation and reality led to widespread disappointment, triggering a rapid sell-off and causing the XLM price to decline. This event served as a powerful reminder of how sentiment-driven the cryptocurrency market can be, and that the accumulation of news can sometimes overshadow the content of the announcement.
Stellar (XLM) price analysis
The price of the altcoin has fallen by 9.40% in the last 7 days and is trading around $0.119 at the time of writing. This decline came right after the 8.86% decline triggered by the last campaign announcement.
Notably, this move caused XLM to lose the support point at the 20-day moving average, a key position it gained just before the September 4 announcement. For context, the 20DMA previously restricted the altcoin's upside for 33 days in August. This current pullback raises concerns about the potential for the price to face a downtrend next month.
Looking at potential reversal points, XLM is expected to fall first to the support point at $0.11. If it cannot hold at this level, the next target will be $ 0.105.
Will the price recover?
It's not all bad for Stellar. The 8% decline brought the Relative Strength Index (RSI) back to an oversold position at 45. While this may indicate that most of the decline is behind us, it could also point to a prolonged stabilization below the 20DMA. The MACD indicator also continues its upward trend and shows a bullish cross at 0.0007, indicating a possible period of consolidation.
We may witness relatively stable price action given the consolidation above the 200-day moving average in the coming weeks.
