As Bitcoin (BTC) has been consolidating recently, many majors have been showing strength with double-digit movements. For instance, Ethereum’s Ether (ETH) rallied from $195 to $245, while Cardano (ADA) rallied with 65% in the recent week.
However, some relatively large altcoins are lagging heavily, and two of them are XRP and Stellar Lumens (XLM), the third and 13th cryptocurrencies by market capitalization, respectively. So what’s next for them?
Crypto market daily performance. Source: Coin360
One billion XRP being dumped on the markets every month
One of the fundamental reasons for XRP to lag behind the other majors is the monthly supply coming on the markets by the headquarters. On the first of every month, one billion XRP is unlocked and transferred to exchanges.
What does that mean? It does mean that every month one billion XRP is being sold on the exchange, which is causing a significant amount of selling pressure. As the current price of XRP is $0.21, the total value of this supply is $210 million, every month.
XRP/USDT 1-day chart. Source: TradingView
The big difference between XRP and the other majors is seen in the chart. While Ether and Cardano are facing the February high as resistance (or broke above that level), XRP is still lagging 40% lower.
On the other hand, there’s also a bullish trend that can be spotted. The price of XRP has flipped a significant level at $0.19 as support. Alongside with that, the 100-day and 200-day MA (moving average) are coming into play.
If XRP breaks through the 200-day MA and $0.23 resistance, the next levels are $0.28 and $0.34.
XRP’s BTC pair is showing extreme weakness
XRP/BTC 1-day chart. Source: TradingView
The real problem of XRP lies in the fact that its BTC pair is doing exceptionally poorly. It’s currently at the lowest point since December 2017, which is more than thirty months!
Heavily needed for any upwards momentum would be a rally and break back above the previous support, which is found between 0.00002300-0.00002350 sats.
If XRP can break back in this range, a further surge towards the 0.00003200-0.00003300 sats level is likely to occur. Next to that, a breakthrough towards 0.00003200-0.00003300 sats would mean a break above the 100-day and 200-day MAs. A bullish sign.
However, the price of XRP is currently still showing weakness and printing new lows, making trading this coin tricky.
What’s next if the 0.00002300-0.00002350 sats level can’t provide support? A further downward move toward the green zones is then on the table with the most likely support at 0.00001550-0.00001625 sats level.
Why is XLM stronger?
XLM/USDT 1-day chart. Source: TradingView
Remarkably, while XRP is showing weakness, XLM is showing strength and continuation to the upside. Could it be because XLM doesn’t have the selling pressure a la Ripple?
It seems to be acting stronger than XRP recently. However, when XLM runs, XRP usually follows, so it’s vital to keep an eye on both of the coins. If one of the two starts to show strength, the other one will likely follow.
The chart is showing some substantial implications of further upwards momentum to occur. One of them is that the price of XLM is moving above the 100-day and 200-day MAs and holds support above these Moving Averages.
Alongside with that support, the green zone is also providing support (which is a horizontal support level). Crucial to continue showing momentum, as the cryptocurrency is in an uptrend since the massive crash on March 12.
Meanwhile, the volume is heavily increased in the recent period. Volume precedes price, through which assumptions can be derived from this data that the coin is being accumulated heavily.
All are a combination of factors that can fuel further upwards momentum. So what’s the most likely scenarios now for XLM and XRP?
XLM/USDT 1-day chart. Source: TradingView
Stellar Lumens is facing a crucial resistance to breakthrough. Once the next level at $0.075 is broken, a further surge towards the $0.085 level is expected. However, as Cardano has shown, this is just a mere resistance level in which the price is more likely to continue rallying.
What’s the next major pivot for Stellar Lumens? It’s found at $0.105-0.11, which would mean a surge of more than 50%.
However, when the $0.075 doesn’t break, a retest of $0.06 is back on the table. That level must hold as support to keep the upward trend intact.
Stellar Lumens’ BTC pair is showing strength
XLM/BTC 1-day chart. Source: TradingView
The BTC pair of Stellar Lumens is showing significant strength, and similar signals as Cardano showed before that one surged massively.
There was an apparent support/resistance flip of the 100-day and 200-day MAs alongside with a support flip of the 0.00000700 sats level.
What’s next to happen for Stellar Lumens? A breakthrough of the 0.00000860-0.00000915 sats level is the next goal. The cryptocurrency has been hovering inside this accumulation range for more than a year. If a break of that resistance occurs, a heavy continuation to the upside can be expected.
The arguments are there as the price flipped the 100-day and 200-day MAs into support. But now, the continuation still has to occur. Such a surge is something, which XRP can only dream of after losing its range support. However, as discussed, once Stellar Lumens starts to move, usually, XRP tends to follow.