XLM Technical Analysis Feb 1

XLM’s 24-hour volume is hovering at the 158.71 million dollar level; despite the downtrend, volume remaining below average signals weak seller participation. This situation highlights the accumulation potential during the price’s bottom search and distances market sentiment from indecisive selling pressure.

Volume Profile and Market Participation

XLM’s current volume profile stands out with a trading volume of 158.71 million dollars over the last 24 hours. This level is significantly below the 7-day average volume (approximately 220 million dollars), indicating low market participation. In volume profile analysis, the Value Area High (VAH) level is concentrated around 0.21, while the Point of Control (POC) is fixed near 0.19. Even as the price pulls back to 0.18 in the downtrend, volume nodes thin out at lower levels; this reflects selective selling rather than a broad-based selling wave.

In terms of market participation, volume in down moves (price -3.92%) stays below 30%, which is insufficient for healthy bearish momentum. Conversely, volume spikes are observed in minor upticks (e.g., around the 0.1787 support). This pattern indicates dominance of retail-focused selling, with institutional players not yet fully engaged. RSI at 29.12 level gives an oversold signal, and the lack of volume confirmation offers hope for a trend reversal. Overall, the volume profile emphasizes low participation, showing that price alone can be misleading – the real story is in the volume.

Accumulation or Distribution?

Accumulation Signals

Accumulation signals are clear: While price is suppressed below EMA20 (0.21), volume in down candles stays 40% below average. This ‘low-volume decline’ is a classic accumulation pattern; it indicates that strong hands (institutional) are cost averaging. In MTF volume levels (1D/3D/1W), there are 8 strong levels, 4 of which are support (S) focused: 0.1655 (74/100 score) and 0.1787 (62/100). In recent weeks, after price tested and was rejected at 0.22 resistance, volume dry-up was observed – a typical Wyckoff accumulation phase.

Additionally, volume delta shows positive divergence: Selling volume is decreasing while buying volume is stabilizing. Combined with RSI oversold, an accumulation zone may form around 0.1655. Target bullish 0.2423 (30 score), accessible with volume increase.

Distribution Risks

Distribution risk is low but present: If volume does not confirm an upside breakout (0.1852R, 72/100), there’s fakeout risk. In the last 3 days, volume decline divergence in minor rallies may imply hidden distribution. For bearish target 0.1186 (22 score), a volume spike is required; current low volume does not support this. Supertrend bearish and MACD negative histogram provide additional warnings for distribution – but no volume confirmation.

Price-Volume Confluence

Despite price being in a downtrend (-3.92%), volume confirmation is weak: Volume on down days < average, interpreted as ‘unhealthy downside’. For a healthy decline, up volume > down volume is needed; here it’s the opposite. As price tests 0.1787 support, volume increase (+15% spike) confirms buyer defense. Divergence is obvious: Price makes new lows while volume contracts – classic bullish divergence.

Price below EMAs looks bearish, but lacking volume confirmation. This suggests the trend is exhausting and a volume explosion can be expected for reversal. Key levels: If support 0.1655 holds with volume, confluence turns positive.

Big Player Activity

Big player (institutional/whale) activities are concentrated in upper tails of the volume profile – high rejection volumes around 0.22R. In the last 1W timeframe, 3 resistance levels (1W breakdown) imply institutional selling pressure, but 1D shows increasing support volumes. No climax volume; low volume down suggests whales are stalking buying opportunities.

Delta analysis: Cumulative volume delta shows tendency to turn from negative to positive. This pattern indicates smart money is accumulating positions – patterns are aligned, though not definitive. Watch: Wallet trackers for sudden volume spikes.

Bitcoin Correlation

BTC at 78,367$ with -6.16% decline in downtrend; Supertrend bearish and rising dominance caution for altcoins. XLM correlates with BTC at 0.85 – if BTC supports (77,897$, 75,720$) fail, XLM is forced to 0.1655. If BTC resistances (80,285$) break, XLM relief rally to 0.1852R. With high BTC dominance, alt volume stays low; BTC stabilization triggers XLM accumulation. Key: BTC break below 77k bearish for XLM, above bullish signal.

Volume-Based Outlook

Volume-based outlook is cautiously bullish: Low-volume decline signals accumulation, awaiting high-volume upside confirmation. Short-term: 0.1655S test, bounce with volume increase. Long-term: Breakout above volume average targets 0.2423. Risk: BTC dump with volume climax down. Overall: Volume does not confirm price – bottom near, accumulation phase likely.

Educational note: Volume beats price alone; divergences give early signals. Spot: XLM Spot Analysis, Futures: XLM Futures Analysis.