Stellar (XLM) Below Key Indicator, Solana (SOL) Bull Run Officially Ended? Ethereum (ETH) on Verge of Ending It
2025-01-14
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As it falls below important moving averages, Stellar finds itself in a difficult position: the asset's 50 EMA, a crucial support level during its most recent uptrend, has been broken below. By highlighting mounting bearish pressure, this move calls into question whether the recent price movements are sustainable. The fact that XLM has also dropped below the 26 EMA, another important indicator that usually serves as a dynamic support level during bullish trends, is even more concerning.
These violations, taken together, indicate a lack of momentum and expose the asset to additional declines. Since price action is still erratic and buyers might try to retake control in the near future, the breakdown has not yet been verified. From a technical standpoint, XLM is in a critical situation right now. Selling pressure may increase if the asset is unable to rise above the 26 EMA. The next support level is located at $0.31, close to the 100 EMA.Stellar/USDT Chart by TradingView">
For long-term investors, a clear breakdown below this level might expose XLM to a more substantial correction toward the 200 EMA at $0.24. Conversely, a robust bounce above the 50 EMA might bolster bullish sentiment and pave the way for a retest of the resistance level at $0.44.
There is potential for price movement in either direction, as the RSI is presently hovering close to neutral territory. The situation necessitates caution even though the breakdown below these key indicators is not yet complete.
Solana's problematic symptoms
Solana is exhibiting concerning symptoms as it approaches the crucial 200 EMA, which is frequently regarded as the last line of defense before an asset enters a bear market. At a price of about $180 right now, Solana is at a turning point that could affect its course in the middle. Investor confidence has already been shattered by the recent decline below the 50 and 100 EMAs, which indicates waning upward momentum.
The 200 EMA test, which is currently trading at about $179, is approaching, putting Solana in a risky position. SOL runs the danger of going into a bearish phase, with lower price levels becoming more likely if this support breaks. A collapse might aim for the $150-$160 range, further undermining the asset's most recent gains.
Other cryptocurrencies have seen sporadic rallies, but Solana has had trouble regaining its bullish momentum. A declining trading volume and a relative strength index (RSI) that is moving into bearish territory support the theory that SOL's bull run may have already ended. A significant recovery from the 200 EMA coupled with an increase in volume and fresh buying interest would be necessary for Solana to regain its bullish momentum.
A retest of the $200-$210 resistance level, which is an important level to monitor for any indications of recovery, could be possible if there is a reversal. The market structure is currently weak, though, as evidenced by the fact that Solana has reached the 200 EMA. It implies that the asset has lost a significant amount of its upward momentum, with buyers apparently worn out following the spectacular late 2024 rally.
Ethereum in big trouble
The price performance of Ethereum is indicating serious issues as the asset keeps declining. Ethereum, which is currently trading at $3,162, has broken through important moving averages such as the 100 EMA and is edging perilously near the 200 EMA, which is at $3,110. Ethereum may move further into unfavorable territory if this level is broken, which could signal a protracted bearish trend.
On-chain metrics present a similarly alarming image. Since the merge, Ethereum's supply has been steadily growing. The supply of Ethereum is currently at 120 million — just 32,457 ETH less than it was prior to the merge. Ethereum may soon eliminate the deflationary advantage brought about by the switch to proof of stake, as supply is increasing by about 45,000 ETH each month.
This pattern suggests that there has not been much demand for ETH, which has prevented the continuous issuance from being balanced. In sharp contrast to the deflationary expectations established during the Merge, Ethereum's supply dynamics have been inflationary for the last 10 months. Despite macroeconomic factors like rate cuts temporarily boosting buying activity in mid-2024, this shift has been made worse by low on-chain activity and a lack of sustained demand.
In addition, the Ethereum burn mechanism, which at first created deflationary pressure, has had trouble counteracting issuance. Technically, there is a lot of resistance for Ethereum between $3,416 and $3,570. To start a recovery, bulls would have to take these levels back. Nevertheless, the probability of a quick recovery seems slim given the declining volume and deteriorating RSI, which is centered around 37.