Stellar XLM price had an impressive week, rallying over 150%. Last week saw XLM break out of a strong price resistance for the first time since May 2021.
Following a strong bullish close last week, the price has since turned bearish. Between Sunday and now, it has experienced more than a 25% price dip, but Stellar price action suggests we could see close to a 40% dip before any chance of a major turnaround.
A Retest of the 42-Month XLM Price Resistance
It is generally known in technical analysis that after a successful breakout, we expect a retest. Although this does not always happen, it is a more common behavior in the market.
The bearish move we have been seeing since it peaked at around $0.63 is only a retracement. XLM Stellar price is currently targeting the broken resistance to turn it into new support. Successfully doing this should lead to a bullish continuation.
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The level that bulls are eyeing for the possibility of a reversal is around $0.40. This level is expected to inject enough liquidity for the market to see a bullish reversal.
If the XLM price closes below this key level, it could halt the entire move, and the price may begin to struggle below the $0.40 level again, as it did between May 2021 and last week.
