Stellar’s Plight: Will Holders Save XLM from the Bears’ Claws?

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Ah, the crypto market-a theater of the absurd, where Stellar’s price languishes like a forgotten actor in a third-rate melodrama. The broader market’s weakness, that fickle prima donna, continues to weigh on altcoins, and poor XLM has been reduced to a steady decline, a tragic hero validating its own bearish chart pattern.

Traders, ever the opportunists, circle like vultures, yet on-chain behavior hints at a different drama unfolding behind the scenes.

Holders: The Unlikely Heroes of Stellar’s Saga

Derivatives data, that cold, unblinking spectator, reveals a market skewed 68% toward short traders-a crowd so bearish one might think they’ve mistaken XLM for a winter coat. Such unanimity, of course, is the stuff of comedy, for it leaves them vulnerable to the whims of volatility. When momentum shifts, as it inevitably does, their crowded trade will amplify price reactions, turning their confidence into a farce.

Below current levels, a cluster of long liquidation leverage lurks between $0.20 and $0.185, a minefield waiting to be triggered. Should the price wander into this zone, forced liquidations will ensue, adding to the selling pressure and accelerating the decline. The bears, ever greedy, salivate at the prospect, blind to the liquidity pockets that may yet betray them.

Craving more of this financial tragicomedy? Subscribe to Editor Harsh Notariya’s Daily Crypto Newsletter, where every day is a new act in this absurd play.

Yet, amidst this gloom, macro indicators whisper of a different narrative. The Chaikin Money Flow, that subtle raconteur, has formed higher lows for four consecutive days, even as XLM’s price printed lower lows. This bullish divergence suggests capital inflows are stirring beneath the surface, like a chorus preparing to upstage the lead actor.

CMF, ever the astute observer, tracks buying and selling pressure through price and volume. Its rise during a price decline often signals accumulation, not distribution. For Stellar, this pattern implies investors are quietly building positions, laying the groundwork for a potential reversal once the selling pressure exhausts itself.

XLM’s precarious dance: Will it find its footing?

At the time of writing, XLM trades near $0.212, clinging to the $0.210 support level like a tightrope walker in a storm. Earlier this week, the altcoin broke down from a descending triangle pattern-a formation as foreboding as a Chekhovian gun in the first act. This breakdown keeps downside risks elevated, a reminder that tragedy often follows hubris.

The descending triangle projects a potential 14% drop toward $0.188, leaving XLM just 11% away from its target. Yet, the price may stabilize before reaching this nadir, finding support around $0.210 or, at worst, near $0.201. This uncertainty lends itself to a neutral-to-bearish outlook, a fitting tone for our melodrama.

A shift in momentum, as in all great dramas, depends on the defense of key levels. If $0.210 holds, Stellar may yet regain its stability. A sustained bounce could push XLM toward the $0.230 resistance zone, invalidating the bearish pattern and signaling a short-term reversal driven by improving demand. But in this theater of finance, as in life, the final act remains unwritten.

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2026-01-22 01:41