🌎 Stellar Lumens Price Drops Amid Market Fears

Stellar Lumens Price Plummets Amid Cryptocurrency Market Fear

The Stellar lumens price has declined for the third consecutive day, sparking concerns across the cryptocurrency market. The XLM price has dropped to $0.2740, its lowest level since February 3, and is now 57% below its peak in November.

This downward trend is not unique to Stellar, as most cryptocurrencies, including Bitcoin and Ethereum, have entered a bear market. The decline in Stellar’s price coincides with the Ripple price retreating and forming a risky head and shoulders pattern.

Historical Correlation between Stellar and Ripple

Stellar and Ripple have historically been highly correlated due to their roles in the cryptocurrency industry and their shared origins. Jed McCaleb, Stellar’s founder, was one of Ripple’s original creators. Both networks focus on payments and have high odds of securing approval for their respective exchange-traded funds from the Securities and Exchange Commission. As a result, a decline in Ripple’s price could further weaken Stellar.

Stellar’s Fundamentals Suggest Further Downside Risk

Data from Santiment shows that total open interest for Stellar has fallen to 64.5 million, the lowest level since November. Additionally, the social volume metric has dropped to 0.28, down from last year’s high of 0.55, indicating reduced attention on social media. Historically, cryptocurrency prices tend to perform better when social media engagement is high.

Tips for investors:

Keep an eye on Stellar’s open interest and social volume metrics, as they can indicate potential price movements.
Monitor the cryptocurrency market as a whole, as trends in other coins can impact Stellar’s price.
Consider the historical correlation between Stellar and Ripple when making investment decisions.

XLM Price Analysis

The daily chart shows that Stellar has formed a series of lower lows and lower highs, creating a descending channel pattern that confirms a downward trend. Stellar is also approaching a death cross, which occurs when the 50-day and 200-day moving averages intersect. Additionally, it has fallen below the 61.8% Fibonacci retracement level, a key technical zone where most pullbacks occur.

Key levels to watch: