- XLM price dropped below the 70.5% Fibonacci retracement level at $0.267 to collect liquidity.
- Market makers are likely to propel Stellar to the trading range’s midpoint at $0.315.
- If the selling pressure leads to the production of a swing low below $0.235, it will invalidate the bullish thesis.
XLM price was on a downtrend as it sliced through the trading range’s midpoint on September 19. Stellar appears to be forming a swing low just below the 70.5% Fibonacci retracement level after collecting liquidity from the July 27 low. Going forward, investors can expect the altcoin to rally and retest the midpoint of the trading structure formed.
XLM price looks to make a comeback
XLM price has dropped roughly 40% since its September 7 swing high at $0.432. This downswing slice though the 50% Fibonacci retracement level at $0.315 on September 19 and has not looked back since.
The recent leg sliced through the 70.5% Fibonacci retracement level at $0.267 to collect liquidity resting below the July 27 swing low in the form of sell stops. While this move is not complete yet, investors can expect the XLM price to start its uptrend here.
A successful reclaim of $0.267 will confirm a new bull rally’s start. In total, market participants can expect Stellar to climb 20% and retest the 50% Fibonacci retracement level at $0.315.
If the buying pressure persists, XLM price could make a run at the buy stop liquidity resting above the swing high at $0.342.
XLM/USDT 1-day chart
On the other hand, if XLM price fails to muster up the bullish momentum to restart an uptrend, the downswing is likely to continue.
After a retest of the 79% Fibonacci retracement level at $0.247, XLM price will likely head toward the last line of defense at $0.235, a breakdown of which will invalidate the bullish thesis. In such a case, investors can expect Stellar to reach for the range lows at $0.198.