Stellar Lumens [XLM] is 25% below local highs reached over the weekend. Despite the pullback, the coin is still 390.5% higher than it was three weeks ago, driven by Bitcoin [BTC] bullish momentum.
Stellar’s all-time high price is $0.8756, which was achieved in January 2018. The Fibonacci extension levels place $0.766 and $0.975 as the next long-term bullish targets.
However, the altcoin is entering a retracement phase that could drop to $0.363 or lower.
XLM demand surges
From its lowest point on November 4 to its highest point on Sunday, November 24, Stellar gained 608% in 20 days.
For an asset with a market value of $14.3 billion, these are staggering returns. They have also come at a breakneck pace.
The CMF is +0.17 and has been above +0.15 since November 6. This is another notable phenomenon, as values above +0.05 are enough to indicate significant capital inflows.
Trading volumes are also getting higher, reaching a peak of $2.83 billion on Sunday.
The Money Flow Index has yet to signal a bearish divergence on the daily chart. This week’s pullback means that the MFI could fall further as XLM retraces to key Fibonacci support levels.
Long liquidations could drag prices down
The liquidation chart data outlines a cluster of liquidation levels around the $0.46 to $0.473 area. The size of these long liquidations exceeds the nearby cluster of short liquidations.
Therefore, there is a high possibility that XLM may drop to $0.46 in the coming days.
A heat map of liquidations over the past two weeks outlines two key areas that could have an impact in the coming days. The liquidity pool closer to the market price is $0.533, with a maximum of $0.55.
To the south, a similarly sized liquidity cluster is located around $0.4. The $0.463 level is also a magnet for a possible rally for Stellar in the short term.
