After facing strong upper resistance at $0.16, XLM price continued to decline, maintaining a downward rebound. This has led to the formation of a resistance trend line, with sellers setting clear control lines to restrain bullish growth.

With multiple lower highs formed, the downward trend is exerting selling pressure on the key 100-day and 200-day moving averages.

Currently, the 50-day and 100-day moving averages are keeping XLM price within a sideways trend between the 50% and 38.2% Fibonacci levels. The range of consolidation from $0.119 to $0.129 marks the struggle between sellers at the $0.119 resistance trend line and buyers.

At the time of writing, XLM price is down 2.15% intraday, testing the dominance of $0.119 and forming a second bearish candle. With the surge in supply, the likelihood of a downward trend is increasing.

What is the next move for Stellar (XLM) price?

The current sideways trend maintains a forbidden zone as a breakthrough of the 50% or 38.20% Fibonacci levels will indicate the next entry point. Additionally, the possibility of a double top within this range suggests a strong likelihood of continuation of the downward trend, trapped in a bull trap.

A break below the 100-day moving average may prompt buyers at the 200-day moving average to absorb another round of selling sparks, adding extra pressure to the psychological barrier of $0.10.

On the other hand, on the optimistic side, if the uptrend breaks above the 50-day moving average, XLM price can extend its bullish trend. Therefore, the uptrend may re-challenge the dominance of $0.142.

After reading this article, what are your thoughts? Feel free to comment and share your analysis for discussion.