Stellar (XLM): Possible Good Short Setup!
2024-10-29

Stellar shows a strong possibility for a downward movement soon, and we’re currently watching for the upper, smaller resistance zone to be reached.

What’s Next?
Following the major drop on October 25th (a 6% market price movement), we broke below the EMAs, and we’re now seeing a strong bullish push, resulting in a smaller fakeout move. It appears this was a liquidity hunt below the EMAs, and we’re now looking for a re-test of the resistance zone.

Scenarios:

	1.	Rejection and MSB: In the first scenario, we’re looking for a good rejection at the resistance zone, which could trigger a potential MSB (Market Structure Break) and lead to a full downward movement.
	2.	FVG Attraction: In the second scenario, we see an FVG zone above the resistance acting as a possible price magnet. If the price reaches this zone, it could be an ideal entry for a short position.

Entry Points:

	1.	Watch the resistance zone closely—it’s our first entry point. If we see weakness there, wait for a clear MSB (orange line) and enter a short position.
	2.	If there’s a breakout above the resistance, the FVG zone will become our second area of interest. If the price reaches this zone, we’ll look for signs of weakness, expecting a reversal back down for a re-test and potential break of the resistance, leading to lower price zones.

Swallow Team 