The price of XLM pulls back after a 609% surge, retesting critical Fibonacci levels. Will the rally continue toward $0.71, or is there a deeper correction ahead?
With the broader market witnessing a pullback, the Crypto Fear and Greed Index has dropped by 3.66% to 79. Despite the overall market remaining firmly in the ‘greed‘ zone, the pullback phase has caused a slight pause in the ongoing altcoin rally.
Stellar (XLM) witnesses a similar halt to the massive bull run and loses the psychological mark of $0.50. Will this pullback undermine the ongoing rally in the XLM price trend? Let’s find out.
XLM Rally Peaks at 600% Gain
In the weekly chart, the surge in XLM has resulted in three massive bullish and gulfing candles. The Stellar bull run began in early November with a 19% surge. It gained momentum in the second week with an impressive 81% jump. The rally topped in the third week with a staggering 175% rise.
Considering the opening and highest prices during the bull run, it extended from $0.090 to $0.63, resulting in a massive surge of 609% in just three weeks.
However, the higher price rejection quickly pulled the price down, and last week’s closing price settled at $0.5365.
With the bullish exhaustion kicking in this week, XLM has dropped by 8.12% and lost the $0.50 psychological mark. Currently, it is retesting the 61.80% Fibonacci level at $0.4666 with a lower price rejection and is trading at $0.4932.
4-Hour Pennant Signals Hopes of a Prolonged Rally
On the shorter-term 4-hour chart, a bullish pennant is forming. The lower price rejection from the 61.80% Fibonacci level signals a strong demand area.
However, constant rejection from the overhead resistance line is keeping bullish growth in check. The RSI line shows no bullish divergence to support a double-bottom reversal and is inching closer to the halfway line.
Considering the weakness in the RSI and the pullback phase, the price could retest the 50% Fibonacci level at $0.3909. To provide additional support, the 50 EMA line is near this Fibonacci level.
On the flip side, a bullish continuation would face the next resistance level at $0.71.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
