Why XLM Volume Hit 3-Year Peak After XRP $1 Rally
star (XLM) trading volume has surged, reaching levels not seen since May 2021. This rise coincides with Ripple (XRP) unexpectedly rising to $1 on Saturday, November 16th.
The price of XLM has also increased by 30% in the past 24 hours, mimicking XRP’s impressive performance. But why is this so? This analysis reveals everything about this closely related movement.
Stellar History and Ripple Still Available
According to data from Santiment, XLM’s trading volume has surged to $2.96 billion as of this writing. The increase in trading volume is a clear indication of increasing buying pressure on the altcoin and a significant increase in market interest.
The last time XLM experienced such high volume levels was during the 2021 bull run, when the crypto asset saw a market-wide rally.
The surge in trading volume suggests investors are becoming More confident in XLM’s potentialespecially In light of XRP’s recent surge. Historically, these two altcoins have had a strong correlation for two main reasons.
First, Jed McCaleb, the former co-founder of Ripple, later co-founded Stellar. The two projects are closely linked, particularly their focus on blockchain-based cross-border payments, making Stellar’s fundamentals closely aligned with those of Ripple.
As a result, the prices of XRP and XLM often move in tandem. Macroaxis data supports this, showing a 90-day correlation coefficient of 0.96. From this perspective, the coefficients range from -1 to +1. Values close to -1 indicate a weak correlation, while values close to +1 indicate a strong correlation between assets.
In addition to XLM trading volume, the altcoin’s open interest (OI) is another indicator that has risen significantly. A high OI indicates that money is flowing into the market and new positions are being opened, reflecting strong bullish sentiment.
Low OI, on the other hand, suggests that this is not the case. According to Santiment, XLM’s OI has increased to $75.05 million, the highest level since Ripple’s partial victory over the United States in July 2023. If the value continues to increase, then the price of XLM may also rise above $0.20.
XLM Price Prediction: May Rise to $0.24
On the daily chart, XLM’s price initially rises to $0.22, but was rejected at the time. Despite the minor pullback, altcoins are still worth more than Ichimoku Cloud. The Ichimoku Cloud is a technical indicator that measures support and resistance levels and determines trend direction.
When the cloud is above price, the trend is downward, indicating higher resistance. But in the case of XLM, the cloud line is below the value, indicating the presence of strong support that could push the price higher.
If this continues and XLM’s trading volume continues to rise, the altcoin could reach $0.24. However, this may not happen if the holder decides to book profits. instead, The price of XLM may drop to $0.16.
Disclaimer
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