Here’s Why Stellar (XLM) Could Soon Lose $10 Billion Market Cap

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The price of Stellar (XLM) has fallen 10% in the past seven days and is currently valued at $10.87 billion, struggling to maintain a market cap of $10 billion. Momentum indicators such as the RSI show a sharp decline, indicating increased selling pressure and possible approaching oversold conditions.

The Ichimoku Kinko Hyo further reinforces the bearish outlook, with XLM trading below the cloud and showing no immediate signs of a reversal. Traders are keeping a close eye on the $0.351 support level as a failure to hold it could lead to further declines, while a successful rebound could pave the way for a rally to $0.40 and above.

Stellar RSI is neutral but falling

The Stellar Relative Strength Index (RSI) is currently at 39.9, a sharp drop from above 60 on December 24, two days ago. This sharp drop indicates a rapid loss of buying momentum and a shift in the market to bearish sentiment.

The shift from the previously strong neutral range to the lower RSI zone indicates an increase in selling pressure, bringing XLM closer to oversold conditions, although not quite into that zone yet.

The RSI is a momentum oscillator that measures the speed and magnitude of price changes on a scale from 0 to 100. Values ​​above 70 indicate overbought conditions, which often precede price corrections, while values ​​below 30 indicate oversold conditions and could foreshadow a rebound.

With an XLM RSI of 39.9 and a rapid decline, the coin is on the verge of bearish momentum, suggesting that further declines are possible in the short term. If selling pressure persists, XLM’s price could test lower levels, but a potential rebound could prevent further declines if buyers re-enter and stabilize the market.

XLM Ichimoku Cloud Shows Strong Bearish Outlook

The Ichimoku Cloud for XLM shows a bearish outlook as the price is currently trading below the cloud (red and green shaded areas), indicating the presence of downward momentum.

The blue conversion line (Tenkan-sen) is below the red baseline (Kijun-sen), further confirming the bearish sentiment, indicating that sellers are currently dominating the market. In addition, the price has failed to break through the cloud in recent attempts, which strengthens the strength of the bearish trend.

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