Bitcoin’s 26 percent rally left many a cryptocurrency in the dust over the course of July.
Indeed, the bitcoin dominance rate, a widely used indicator that tracks the percentage of the total crypto market cap contributed by bitcoin, rose to 48 percent, up from 42 percent, to record a 7-month high over the 31-day period, a function of money shifting from alternative cryptocurrencies into bitcoin.
That said, not every alternative cryptocurrency saw gains. Ether, the cryptocurrency that powers the ethereum blockchain, and the second-largest cryptocurrency by total value, as an example, recorded a monthly loss.
A notable exception among the largest 25 cryptocurrencies reviewed by CoinDesk, however, was stellar’s XLM token, which was able to defy the odds and become the top monthly performer in its class. Fueled by interest from the most influential U.S. exchange, Coinbase, the news the startup is considering an XLM listing revved up investor interest, spiking 13 percent on the news.
Still, it’s arguable that this simply helped galvanize stellar’s appeal after notable recent milestones.
In recent months, teams seeking to launch initial coin offerings (ICOs), including social messenger Kik, have begun to utilize stellar’s technology. Also notable has been the team’s technical commitments, such as its prominent support for the scaling solution, lightning network, which developers say they aim to implement this year.
Along the ride, stellar would go on to hold its gains, though, eventually displacing litecoin to become the world’s sixth largest cryptocurrency by market capitalization – valued today just north of $5 billion.
Monthly performance: +40 percent
All-time high: $0.90
Closing price on June 30: $0.19
Current market price: $0.27
Rank as per market capitalization: 6
XLM began its monthly ascent on July 13 (Coinbase news), reaching its monthly high of $0.36 12 days later when it showed a 93 percent gain from the month’s open of $0.19.
Still, the crypto asset cooled off during the last week of the July, dropping 11 percent, likely due to overextended technical charts and a wavering bitcoin price. When July came to a close, Stellar finalized its 40 percent month-to-month appreciation.
Price closed above the two-month long descending trendline (yellow) on July 14, a bullish signal seen in the chart above, and continued its journey past the 200 day exponential moving average to the 0.618 Fibonacci Retracement (from May high of $0.47). Its monthly high mark of $0.36 was set shortly after on July 25.
The combination of resistances proved to be too strong as price failed to find acceptance above the levels, first hinted by bearish divergence in the daily RSI. Price consequently reversed over 24 percent to where it stands today just below $0.28.
Only a daily close below the long term trendline (blue) would return the immediate trend to bearish favor and suggest a move towards the 0.236 Fibonacci retracement located near $0.23. On the upside, a bounce off of the trendline could be seen as a successful throwback test and would add credence to the bullish trend change, setting sights back on the elusive $0.36 resistance.
Disclosure: The author holds BTC, AST, REQ, OMG, FUEL, 1st and AMP at the time of writing.
Rocket image via Shutterstock
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