Stellar (XLM) Below Key Indicator, Solana (SOL) Bull Run Officially Ended? Ethereum (ETH) on Verge of Ending It

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In my exploration of Stellar’s performance, I find myself grappling with its current predicament. As it dips beneath significant moving averages, the asset is facing challenges. The breach below the 50 Exponential Moving Average (EMA), a critical support level during its recent upward swing, raises concerns about the durability of its recent price fluctuations. Moreover, the fact that XLM has also fallen beneath the 26 EMA, another essential indicator typically serving as a dynamic support during bullish trends, is cause for further apprehension, suggesting mounting bearish pressure.

Combined, these infractions suggest a stagnation and potentially make the asset vulnerable for further drops. Given the current volatile market behavior, buyers could potentially regain control soon, but the downward trend hasn’t been definitively confirmed yet. From a technical perspective, Stellar Lumens (XLM) finds itself in a crucial position at present. If selling pressure prevails and XLM fails to surpass the 26 Exponential Moving Average (EMA), it could lead to increased selling pressure. The next potential support level can be found near the 100 EMA, around $0.31.

If long-term investors see XLM’s price falling below this specific point, it could lead to a larger drop in value, potentially reaching the 200 Exponential Moving Average (EMA) at around $0.24. Contrarily, a strong rebound over the 50 EMA could boost optimism and possibly initiate another attempt to reach the resistance point at $0.44.

The RSI (Relative Strength Index) is currently near a neutral zone, indicating that there could be a shift in prices up or down. It’s essential to exercise caution since the market hasn’t fully broken down the important signals yet.

Solana’s problematic symptoms

As Solana moves towards the significant 200 Exponential Moving Average (EMA), a point often seen as the final barrier before an asset enters a downward trend, also known as a bear market, it’s displaying signs of potential trouble. Currently trading around $180, Solana finds itself at a critical juncture that could significantly influence its future trajectory. The decline below both the 50 and 100 EMAs has already eroded investor confidence, suggesting a decrease in bullish momentum.

The approaching 200 EMA (Exponential Moving Average) level, currently around $179 for Solana, could place it in a precarious situation. There’s a potential risk that Solana might enter a downward trend, with lower prices becoming increasingly likely if this support gives way. A possible drop could target the $150-$160 zone, which could further erode the asset’s recent progress.

While other digital currencies have experienced occasional surges, Solana has struggled to rebuild its bullish trend. The dropping trading activity and a relative strength index (RSI) heading towards bearish zones suggest that Solana’s upward movement might have concluded. For Solana to regain its bullish momentum, it would require a strong recovery from the 200 Exponential Moving Average (EMA), an uptick in trading volume, and renewed buying interest.

A potential re-examination of the $200-$210 barrier, a crucial level to watch for signs of recovery, might occur if there’s a reversal in trend. However, the market structure is presently fragile, as suggested by Solana touching the 200 Exponential Moving Average (EMA). This suggests that the asset has significantly lost its upward momentum, and it appears that buyers are exhausted after the impressive late 2024 rally.

Ethereum in big trouble

The recent downward trend in Ethereum’s value suggests significant troubles, with the cryptocurrency dropping below key moving averages like the 100 EMA and nearing the 200 EMA at $3,110. If Ethereum continues to fall below this level, it could hint at a prolonged bearish market.

Following the merger, the amount of Ethereum in circulation has been gradually rising. Currently, there are approximately 120 million Ethereum tokens, which is only about 32,457 fewer than before the merger. This suggests that Ethereum could soon lose its deflationary trait, as around 45,000 new ETH are being added to the supply each month.

The pattern indicates that there hasn’t been a significant need for ETH, causing the ongoing issuance to be unbalanced. Contrary to the anticipated deflation expected during the Merge, Ethereum’s supply behavior has shown signs of inflation over the past 10 months. Although temporary economic factors like rate cuts stimulated buying activity in mid-2024, this issue has been exacerbated by low on-chain activity and a persistent lack of demand.

Apart from this, the Ethereum burn mechanism initially introduced deflationary forces, but it’s struggled to offset issuance effectively. In terms of technical analysis, there appears to be considerable resistance for Ethereum between approximately $3416 and $3570. For a recovery to begin, bulls must regain control over these levels. However, the chances of a swift rebound appear slim due to dwindling trading volume and worsening RSI, currently hovering around 37.

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2025-01-14 03:19