Stellar (XLM) continues to struggle after months of decline. Despite some attempts to recover, the altcoin has encountered significant hurdles, most notably its failure to overcome the $0.325 resistance level. As the broader market remains under pressure, XLM’s recovery looks more fragile than ever.

Death Cross Threatens Stellar

One of the most notable technical factors today is the Death Cross – a strong bearish signal in technical analysis. Specifically, the 200-day exponential moving average (EMA) is approaching a crossover with the 50-day EMA. This will be Stellar’s ​​second Death Cross in 2024, after the previous one in April.

Usually, when a Death Cross forms, selling pressure increases, making it difficult for the price to maintain the upward momentum. In the current situation, XLM is unlikely to break above $0.30 and may even drop to lower support levels.

Selling Pressure Increases as Money Flows Out of XLM

Not only technical factors, but macro dynamics are also not in Stellar's favor. The Chaikin Money Flow (CMF) indicator, which tracks money flows into and out of the asset, is recording a sharp decline this month. Currently, CMF is deep below zero, indicating that money flows out of XLM are dominating the money flows into investment.

This reflects the growing pessimism among investors, making the recovery of XLM more difficult. Without support from buying power, the altcoin may continue to face downward pressure.

XLM at Risk of Losing Important Support

At the moment, XLM is trading at $0.272, just above the important support level of $0.259. For the past three months, Stellar price has been oscillating within a descending wedge pattern, indicating a weakening trend. If it fails to break out of this pattern in the short term, XLM could remain stuck in a downtrend.

As long as the price remains below $0.299, selling pressure could push XLM to lower support levels, even testing the $0.231 area or lower. The ongoing Death Cross could exacerbate this situation and prolong Stellar’s ​​negative trend.

What Does XLM Need to Recover?

To break out of the current downtrend, Stellar needs to break above $0.299 and then conquer the important resistance level at $0.325. If XLM can break the $0.355 mark, it could confirm a reversal and open the door for a recovery. However, this would require a major shift in market sentiment and investor confidence.

In the current scenario, Stellar has not shown signs of being strong enough to recover. If the selling pressure continues, XLM could face further declines in the coming time.