Stellar rallied to highs of $0.418 as some altcoins exploded into life amid high exuberance within the crypto market
Stellar (XLM) saw its price jump from around $0.23 to touch highs of $0.418, the highest price level since May 2018.
Although it has since retreated to around $0.35, the explosion seen over the past 24 hours meant XLM was the highlight of the top 10 cryptocurrencies. The massive price surge over the past 24 hours had XLM in the limelight alongside the mercurial jump to $37,000 for Bitcoin (BTC).
Other altcoins have also seen major moves up the charts, including Cardano (ADA), EOS, Ripple (XRP) and Nano (NANO).
But although alts have exploded into life, the market is experiencing extreme volatility at the moment. This means that prices are likely to fluctuate big time. Stellar could reach a new all-time high or flip bearish and retest support at $0.12.
Stellar: technical picture
XLM/USD has printed consecutive bullish candlesticks over the past four days and could add another higher daily close. The bullish run for XLM/USD comes after the altcoin broke out of a descending triangle pattern, driven by positive fundamental news about Ukraine choosing to use the Stellar blockchain for its CBDC.
If buyers manage to rally to the recent highs near $0.42 (61.8% Fibonacci extension level), there might be only two other major resistance resistances likely to block a bullish run to a new all-time high. These hurdles are at the 50% Fibonacci level of the old swing down at $0.53 and 61.8% Fibonacci level at $0.66.
XLM/USD daily chart. Source: TradingView
On the flip side, XLM/USD could drop to $0.12 in the short-to-medium term.
The long upper wick on the daily candle suggests bulls’ dominance has faced massive resistance. The chart also shows the Relative Strength Index (RSI) in the overbought territory that supports the retreat. While the potential for a downturn could rely on overall crypto market action, it is more likely bulls could be hitting exhaustion levels after such an epic price surge.
To retain the upper hand, bulls need to keep prices above two critical levels: $0.33 and $0.23. The latter price level is the scene of the most recent rejection that saw XLM/USD hit a downtrend as Bitcoin (BTC) rallied throughout December. Break this line and bears could have easy targets at the 50-SMA ($0.16) and 100-SMA ($0.12).