Trade Recommendation: Stellar
We removed Stellar (XLM/BTC) from our watch list when it failed to hold 0.000026 on January 28, 2019. At that point, we knew that a move below this level will likely result in panic selling. That’s because 0.000026 stood as the market’s 2018 support. Stellar has managed to stay above this level for the whole of 2018. Thus, the move below it on January 28, 2019 ignited massive selling.
To stop the bleeding, Stellar needed to generate heavy volume on the daily chart. This would indicate that a big buyer has stepped in to absorb the selling pressure. We suspect that this happened yesterday, February 19.
Technical analysis shows that XLM/BTC is attempting to carve a durable support at 0.000021. This view comes after Stellar printed heavy volume yesterday when the market touched 0.000021. On February 19, the volume skyrocketed to 142.652 million XLM units when the daily trading average was about 60.614 million XLM units. The last time Stellar generated this type of volume was five months ago. This was an indication that a large player has stepped in.
In addition, XLM is trading near oversold conditions. With the market being so badly beaten over the last couple of months, it is due for a relief rally at the very least.
The strategy is to buy as close to 0.000021 as possible. If bulls can stay above this level, they will likely generate a rally to our targets of 0.000026 and 0.00003.
The process may take a month.
Daily Chart of Stellar/Bitcoin on Binance
As of this writing, the Stellar/Bitcoin pair is trading at 0.00002288 on Binance.
Summary of Strategy
Buy: As close to 0.000021 as possible.
Targets: 0.000026 and 0.00003.
Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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