Even Good News Was Useless…Altcoin Exodus Shakes Stellar (XLM)

▲ Stellar (XLM)/AI-generated image ©

Stellar (XLM) experienced a sharper decline than the market average due to a combination of worsening investor sentiment across altcoins and the breakdown of technical support levels. Despite on-chain growth, an analysis suggests that a short-term bearish trend continues as investor funds shift towards Bitcoin.

According to CoinMarketCap, a cryptocurrency market tracker, on July 8 (local time), Stellar traded at $0.185, down 5.69% over the past 24 hours. The primary reason for this decline was the overall weakness in the altcoin market. The share of cryptocurrencies excluding altcoins decreased from 33.04% last week to 31.98%, and CoinMarketCap's Altcoin Season Index also fell by 4.17% to 46 over the past seven days. The media explained that this signals a shift of investor funds from relatively risky altcoins to Bitcoin.

Bearish sentiment in the derivatives market and the breach of technical support levels also fueled the decline. Despite positive ecosystem news, such as cooperation with the United Nations Development Programme (UNDP) and the expansion of real-world assets (RWA) valued at $3 billion, bearish outlooks dominated the derivatives market. The long-short ratio dropped to 0.84, its lowest level in the past month, indicating more investors betting on a decline, and the price fell below the 50-day exponential moving average (EMA) of $0.192. The media analyzed that speculative selling pressure and weakened technical trends offset the positive fundamentals.

In the short term, the 100-day exponential moving average (EMA) of $0.1872 was presented as a key support level. The media predicted that if XLM recovers and maintains this price, it might trade sideways in the $0.1872-$0.1985 range, but a definitive break below $0.1872 could lead to further declines to the next major support level of $0.1774.

The media assessed that the short-term trend still leans bearish. However, if Bitcoin stabilizes above $62,000, the outflow of funds from altcoins may ease, and whether CoinMarketCap's Altcoin Season Index surpasses 50 again was presented as a crucial variable for a market rebound.

*Disclaimer: This article is for investment reference only, and we are not responsible for investment losses based on it. The content should be interpreted for informational purposes only.*