Stellar (XLM) price is facing mixed signals, down 29% in 30 days. The death cross on December 20 indicates selling pressure, but increased buying could signal a reversal.
The DMI is showing a bearish trend with ADX above 25, while the CMF at 0.19 suggests strong accumulation. XLM faces support at $0.31 and resistance at $0.40 with a possible upside.
XLM DMI Shows Strong Bearish Trend
The Directional Movement Index (DMI) for Stellar shows increasing trend strength, with its Average Directional Index (ADX) rising from below 20 to 26.8 in just four days.
ADX measures the strength of the trend: below 20 is weak, 20-25 indicates development, and above 25 signals strength. An ADX above 25 suggests a continuing, rising trend.
XLM DMI. Source: TradingView
Furthermore, the current readings of D+ at 13.2 and D- at 21.5, combined with the rising ADX at 26.8, paint a bearish picture for XLM’s price. Since the D- (negative directional indicator) is higher than the D+ (positive directional indicator), this confirms the bearish nature of the trend.
The rise in ADX above 25 suggests that this downward movement is strengthening and may continue, with the significant difference between D- and D+ reinforcing the likelihood of sustained downward price action.
Stellar's CMF has risen in the last 24 hours
The Chaikin Money Flow (CMF) for XLM experienced a dramatic increase, jumping from 0.03 to 0.19 in just 24 hours.
The CMF indicator combines price and volume to measure buying and selling pressure. Positive values above zero indicate accumulation, and negative values suggest distribution. The magnitude of the reading (closer to +1 or -1) indicates the strength of the money flow.
XLM CMF. Fonte: TradingView
A spike in the CMF to 0.19, the highest reading since November 24, signals strong buying pressure and institutional accumulation.
However, the increase from neutral territory (0.03) to a positive value reflects a change in sentiment, with a strong inflow of capital into Stellar. This increase in the CMF usually anticipates a price increase, indicating a buying conviction among large investors.
XLM Price Prediction: Will the Bearish Trend Prevail?
XLM price recently saw a significant bearish signal with the formation of a death cross on December 20th where the short-term moving average crossed below the long-term average.
Furthermore, this technical pattern suggests increasing selling pressure, with the immediate support level at $0.31 being crucial for price stability. If this support fails to hold, XLM price could experience a further decline towards the $0.25 level, posing a significant downside risk.
XLM Price Analysis. Source: TradingView
However, recent Chaikin Money Flow data suggests potential for a trend reversal and upward momentum. If Stellar price can capitalize on this positive money flow and establish an uptrend, it could challenge the immediate resistance at $0.40.
Furthermore, a break above could lead to $0.47, with a potential upside of 34%, but requires sustained buying pressure to overcome the technical low.
The article Stellar (XLM) Price Shows Signs of Life; Understand was first seen on BeInCrypto Brazil.
