The Bitter Fate of XLM: A Sliver of Hope in a Sea of Bears 🐻😂

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In the vast, often cruel world of cryptocurrency, Stellar (XLM) has found itself in a peculiar and rather grim predicament. Just as it seemed to be breaking free from its chains, XLM has plummeted over 6% in the last week, erasing any semblance of short-term momentum. 😢

Despite a commendable 41% ascent over the past three months, the winds have shifted, and it seems the sellers are once again calling the shots. The faintest glimmer of hope for a recovery lies in an unlikely and precarious market imbalance, a true testament to the unpredictable nature of fate. 🤷‍♂️

EMA Crossover Flashes a Clear Warning, Bearish Power Builds

On the 4-hour chart, the XLM price has now fallen below all four EMAs – the 20, 50, 100, and 200-period exponential moving averages. Most notably, a bearish EMA crossover has just formed, where the 50 EMA (orange line) has dipped below the 100 EMA (sky blue line). This ominous sign, known as the “Death Cross,” is infamous for heralding sharp corrections. 🕰️

An Exponential Moving Average (EMA) is a tool that gives more weight to recent price data, allowing it to more accurately capture the current momentum. When a shorter-term EMA crosses below a longer-term EMA, it’s a clear bearish signal, indicating that recent prices are falling faster than the longer-term trends. When the 50 EMA dips under the 100 EMA, it’s often a sign that buyers are losing control and sellers are taking over. But there’s more to this dark tale.

The same chart reveals deep “reds” in the Bull-Bear Power (BBP) indicator. This metric compares recent highs and lows to a trend-following average, gauging whether buyers or sellers are in control. XLM’s BBP is now firmly in negative territory, a stark confirmation that the bears have seized the reins of the short-term price structure. 🐺

Thus far, the price action speaks of weakness. Yet, this is only the beginning of our tragic narrative.

Liquidation Map Shows Shorts Dominating, And That’s the Only Hope

On Bitget, XLM has witnessed nearly $75.82 million in short liquidations and close to $20 million in long liquidations over the past 7 days, painting a picture of overwhelming bearish sentiment among traders. 📉

Ironically, this heavy bearish bias is the lone ray of light in XLM’s otherwise gloomy forecast. Should the broader market rally even slightly, the shorts may find themselves in a painful squeeze, leading to forced liquidations and a potential surge in prices. 🚀

A short squeeze occurs when an excessive number of traders bet on a price decline, only to see the price rise instead. In their panic, they rush to buy back their positions, driving prices even higher in a sudden and dramatic fashion. 🎡

XLM Price Pattern Breaks Down, But Critical Levels Remain in Sight

XLM has decisively broken out of its recent pennant formation on the daily chart. The immediate support level now stands at $0.40. Should this level be breached, the bearish crossover and BBP pressure could propel the price towards $0.36 in the coming sessions. ⚖️

However, if a short squeeze materializes and XLM manages to recapture the $0.42 to $0.44 range, the near-term bearish structure would be nullified. This could shift sentiment and spark aggressive buying. Until then, the bears remain the masters of this domain, with only one unusual imbalance offering a sliver of hope. 🌟

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2025-08-20 02:26