Ripple (XRP) and Stellar (XLM) Hit Resistance: A Mere Breather or a Sign of Reversal?

▲ XRP, Stellar (XLM)/AI generated image ©

As XRP (Ripple) and Stellar Lumens (XLM), two prominent altcoins in the virtual asset market, simultaneously hesitated after being blocked by key resistance levels, investor anxiety is escalating over whether this correction is merely a breather or the beginning of a downtrend. According to media reports, both assets are experiencing short-term downward pressure, but with on-chain indicators and derivatives market data showing mixed signals, market participants appear to be maintaining cautious optimism.

According to FXStreet, an investment media outlet, on July 7 (local time), indicators in the derivatives market are presenting somewhat mixed outlooks. Based on CoinGlass data, XRP's long/short ratio recorded its lowest level in a month at 0.73, and XLM also approached a month's low at 0.84. While a ratio below 1 indicates that more short-sellers are betting on a price decline, the funding rates for XRP and XLM remained positive on the same day, at 0.0061% and 0.0058% respectively. A positive funding rate means that long position holders are paying short position holders, suggesting that an underlying sentiment of expecting a rise still persists.

A cautious mood is also observed in on-chain and institutional demand indicators. According to CryptoQuant summary data, large whale orders have been detected in XRP's spot and futures markets, supporting potential recovery, while XLM showed strong selling-side dominance, creating a contrast. SoSoValue data indicated a relatively quiet flow of institutional demand; after a net inflow of $17.19 million into the Ripple spot ETF last week, Monday saw a somewhat subdued trend. Experts analyzed that if the trend of capital inflow into spot ETFs strengthens again in the future, XRP could attempt a full-fledged rebound.

From a technical analysis perspective, XRP is facing strong resistance. Currently trading at $1.1393, XRP's price is below its short-term resistance of the 50-day Exponential Moving Average (EMA) at $1.1820, as well as the 100-day EMA at $1.2834 and the 200-day EMA at $1.4912, indicating prevailing short-term downward pressure. Moving within a downward parallel channel, the Relative Strength Index (RSI) is hovering around the neutral level of 51, and the Moving Average Convergence Divergence (MACD) is in positive territory but with slightly decelerated upward momentum, suggesting limited recovery rather than a trend reversal. If the key support level of the channel bottom at $1.1054 breaks, further deeper correction could occur.

On the other hand, XLM is building a relatively sound support base. Currently, XLM's price is $0.1978, trading above its 50-day EMA of $0.1922 and 100-day EMA of $0.1872, maintaining a moderate upward momentum. However, it is currently trapped just below the 200-day EMA of $0.1985 and the Fibonacci 61.8% retracement level resistance of $0.2001. XLM's RSI is around 51, and MACD also maintains a positive trend above 0, indicating stable upward energy without overheating. However, if the $0.1922 support level breaks in the future, there is a risk of a decline to the $0.1774 level.

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