Will the range-low ease Stellar’s retracement

Posted: September 18, 2023

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

• XLM has been stuck in a price range since mid-August. 
• XLM’s demand declined further in the derivatives segment. 

Stellar [XLM] has presented consistent gains to swing traders in the last few weeks. In the first week of September, the rebound from the range-low ($0.11) to the range-high ($0.13) offered over 18% gains to bulls. 

Is your portfolio green? Check out the XLM Profit Calculator

The retracement from the range-high, seen at press time, could hit the range-low, effectively offering sellers 15% gains. But can it provide extra gains ahead of the Fed’s decision on 20 September? 

Is another rebound likely at the range-low?

Source: XLM/USDT on TradingView

Since mid-August, XLM bulls have defended the range-low of $0.11, which is close to the weekly bullish order block (OB) of $0.095 – $0.109 (cyan). The past two retests of the range-low hit the range-high. 

If the trend repeats alongside a favorable Fed announcement on 20 September, XLM could rebound at the range-low ($0.11) and target the mid or range-high. 

A surge above the confluence of the range-high and H12 bearish OB of near $0.13 could tip bulls to extend gains to $0.14. 

However, any extra pullback beyond the range-low could ease the weekly bullish OB. 

Meanwhile, the RSI retreated into the low range and wavered, indicating buying pressure dropped and stagnated. However, the CMF was above its threshold but had sideways movement, indicating capital inflows were positive but stagnant. 

Demand for Stellar dropped

Source: Coinalyze

The futures market data captured a more bearish inclination. For example, the Open Interest rates dropped by approximately $10 million between 9 and 17 September. It denotes an extended decline in demand for XLM in the derivative segment. 

How much are 1,10,100 XLMs worth today?

The excessively negative funding rates over the same period further tipped the scale in favor of sellers. 

In addition, the Accumulative Swing Index (ASI), which tracks the strength of price swings, had a downslope and flipped negative at press time, reinforcing a strong downtrend. 

So, a retest of the range-low was likely, and bulls could see reprieve at the level.