Stellar's XLM token has declined 7.27% over the last 24 hours, falling from $0.1256 down to $0.1164 as of August 18, 2023. This continues a rough stretch for XLM, which has now plunged 16.72% across the past week. The monthly view is also bleak, with XLM down 10.27% in July.
However, zooming out to the 6-month view reveals a brighter picture. Here XLM shows a substantial 26.70% gain, indicating the recent weakness comes following a larger upward move.
Stellar now has a market capitalization of $3.17 billion. Its 24-hour trading volume reached $152.29 million, showing there is still significant interest in XLM despite its lackluster price action.
From a technical standpoint, Stellar appears oversold with its Relative Strength Index around 25. Previous instances when XLM neared oversold territory marked profitable buying opportunities, suggesting current prices may offer an attractive entry point.
Broader risk asset weakness has contributed to XLM's recent slump amidst concerns over surging inflation, rising rates, and potential recession. However, Stellar's robust platform and real-world utility could allow it to outperform when macro conditions improve.
Current Prices Make Stellar a Compelling Buy
With XLM trading over 85% below its all-time high, current prices present an intriguing opportunity for long-term crypto investors.
Stellar offers fast, inexpensive cross-border payments capabilities and a robust platform for launching decentralized applications. Its partnerships with banks and financial institutions give it real-world credibility and adoption.
As a deflationary asset with a fixed supply, XLM offers inflation-hedging abilities similar to Bitcoin. And at just a fraction of Bitcoin's price, it has more room for exponential upside in the years ahead.
Considering the substantial headroom until Stellar revisits past highs, its current undervalued pricing following the broader crypto correction, and its promising real-world utility, strong potential upside exists for patient holders.
I Forecast Stellar Reaching $1 by 2025
Given Stellar's entrenched partnerships in the traditional financial system, deflationary attributes, and growth roadmap, I expect its XLM token increasing to $1 by 2025. This represents nearly 750% upside from today's prices.
Stellar serves as critical financial infrastructure for institutions to facilitate affordable cross-border payments. As adoption of blockchain-powered financial services accelerates, Stellar appears well-positioned to capture a meaningful share of activity.
Cryptocurrencies remain in a long-term uptrend overall despite periodic corrections. Once the macro backdrop improves, assets with real-world utility like Stellar tend to soar as investors re-embrace growth opportunities.
From a charting perspective, Stellar remains in a clear uptrend over the past 5+ years. Its latest correction should give way to the next major wave higher, likely surpassing its previous peak during the next bull cycle.
For long-term investors, Stellar presents an intriguing asymmetric risk/reward opportunity. Near-term headwinds could persist, but upside potential of 10x or more exists over a 5-10 year investment horizon.
Should I Buy Stellar Now?
For investors seeking well-established crypto assets with actual utility, Stellar appears attractive around current prices.
XLM trades at an extreme discount relative to past price levels, suggesting substantial upside potential exists once macro headwinds fade and crypto bullishness returns.
That said, risks remain in the near-term. XLM could see further downside, especially if the anticipated recession arrives. Cryptocurrencies are volatile in general. Proper portfolio allocation and risk management are essential.
But for strategic crypto investors, buying high-quality assets like Stellar during times of negative sentiment often yields great rewards years later. Those with long time horizons likely stand to benefit buying at prices not seen since 2020.
What Amount Should I Invest in Stellar?
Determining how much to invest in Stellar depends primarily on your risk tolerance and investing timeline. As a volatile cryptocurrency, XLM should represent a small portion of a diversified portfolio.
Most experts suggest allocating 1-5% of your total assets to any single crypto holding. This provides sufficient exposure while limiting downside risk. More aggressive investors may opt for 10% or slightly higher allocations, while conservative investors should cap XLM below 1%.
Dollar cost averaging - making small recurring buys over time - helps smooth out volatility. Given crypto's extreme swings, a multi-year investment time frame is recommended. Avoid overexposing yourself to XLM with money you may need in the short-term.
Considering your specific financial situation, investing style, and objectives allows determining a prudent XLM allocation size that keeps risk contained yet allows for substantial growth over the long run.