Why Is Stellar (XLM) Price Down Today?

Why Is Stellar (XLM) Price Down Today?
Why Is Stellar (XLM) Price Down Today?

NEW DELHI (CoinChapter.com) — Stellar (XLM) price has registered losses for the third consecutive day on Nov. 14. A day before, the XLM price rose 15% to $0.135, its highest level in three months. The move followed a minor 1.5% correction as traders booked profits.

Stellar’s “Real World” Campaign Fails To Excite Investors

One of the reasons XLM has fallen out of favor with investors is the failure of Stellar’s Real World campaign. The blockchain platform had roped in actor Idris Elba for the campaign. Stellar hoped to highlight the efforts of its project builders through the campaign.

Stellar planned to focus on the practical applications and impacts of its ecosystem. Additionally, the campaign focused on highlighting initiatives like the International Rescue Committee’s work in transparency in aid disbursement.

However, despite the star power, the campaign was a marketing failure. Moreover, XLM prices fell as the campaign struggled to gain traction, falling victim to the market’s ‘sell the news‘ response.

The campaign’s failure to fuel a bullish rally for XLM resulted in the Stellar cryptocurrency further losing investor confidence.

The funding rate for XLM futures contracts remained positive despite a 77% drop since Nov. 12 to reach 0.009% on Nov. 14. Furthermore, the recent downtrend has wiped out nearly $1.2 million in long positions since Nov. 9, compared to the liquidation of $260,000 worth of short positions.

XLM Moving Inside Bearish Pattern

Technical indicators forecast a ‘sell‘ signal for the Stellar coin on the daily timeframe, which could result in increased selling pressure for the token. Meanwhile, XLM price has formed a bearish technical pattern called the ‘Descending Triangle.’

XLM price has formed a bearish pattern with a 95% downside target.
XLM’s price has formed a bearish pattern with a 95% downside target. Source: Tradingview.com

The descending triangle is a bearish continuation setup with a falling resistance line that caps upside attempts and a flat support that prevents declines. The height of the triangle’s thickest section determines the price target in a descending triangle setup.

The pattern’s descending trendline resistance rebuffed’s XLM price’s upside attempts. If the triangle pattern pans out, XLM could face a drop of over 95% to reach the projected price target near $0.005, theoretically.

Investors relying on technicals would likely stay away from the Stellar crypto token. On the other hand, if bulls manage to break above the descending trendline resistance, buyers might flock to the market, further boosting XLM’s prices.

Bulls Defending Stellar’s EMA Support

Bulls are trying to ensure XLM price stays above the 50-day EMA (purple wave) and 100-day EMA ( blue wave) dynamic support confluence after the token dropped 3.7% to a daily low of $0.118 on Nov. 14.

If XLM price breaches the EMA trendline support, bulls would be forced to defend the 200-day EMA (green wave) support near $0.114. Moreover, breaching the immediate support level could send XLM price hurtling to the support near $0.105.

XLMUSD daily price chart with MACD.
XLMUSD daily price chart with MACD. Source: Tradingview.com

The momentum oscillator MACD is showing increasing bearish momentum for the Stellar token. Negative bars on the MACD histogram are expanding, indicating the MACD line (difference between 12-day and 26-day EMA, blue wave) moves away from the MACD signal line (9-day EMA of MACD, orange wave).

If Stellar manages to negate the bearish pressure and start a rally, XLM price would face resistance near $0.128. Breaking and consolidating above the immediate resistance might help Stellar price target the key resistance level near $0.135.

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