- Stellar is testing key support at $0.32, aligning with Fibonacci levels and value area low, signaling a potential reversal.
- A falling wedge formation on Stellar’s chart is nearing a breakout, with volume needed for confirmation.
- USDY, a yield-bearing stablecoin, is now available on Stellar, signaling growth in the network’s ecosystem.
Stellar (XLM) is currently testing a key support level at $0.32, coinciding with the 0.618 Fibonacci retracement and the value area low. This crucial zone has historically acted as a strong reversal point. As price action tightens within a falling wedge pattern, it may be setting the stage for a potential breakout. The breakout, supported by volume, could push Stellar’s price towards the $0.50 resistance, which also represents a high-timeframe resistance level.
The golden pocket (0.618 Fibonacci) is not the only level that strengthens the presence of the support of the level of 0.32, but also the high-timeframe support gives the buyers a solid foundation. The combination of technicalities makes the region an important turning point for cryptocurrency. Also, the prevailing price pattern conforms to the low value area, which indicates even more support for a trend reversal.
Falling Wedge Pattern Approaches Apex.
There is a falling wedge pattern with an 8-point pattern that is approaching the apex, hence a possible bullish resolution. Falling wedges are normally bullish formations, which can be extremely sharp when corroborated by an adequate quantity. The probability of the price action breaking out is heightened as the price action becomes concentrated at this critical junction.
Source:TradingView
Although the arrangement will appear encouraging, volume is the factor that will determine whether the breakout is valid or not. Without enough demand, Stellar will have to continue further consolidation or a fake breakout and will wait for a clear trend. Nevertheless, in case the breakout is validated with the help of volume, it might lead to a rally of the volume towards the horizontal marker of the wedge, namely, to the resistance of $0.50.
The place of Stellar in the expanding Stablecoin market.
Besides the positive technical perspective, the presence of Stellar in the newly developed stablecoin market is an added dose of hope. The recent rollout of USDY, a yield-paying stablecoin by Ondo Finance, which is pegged to the U.S. Treasuries and bank deposits, is currently within reach of the Stellar network. The given development emphasizes an increasing role of Stellar in the blockchain ecosystem and reinforces its long-term perspectives further.
