Key takeaways

• Stellar is up 7% in the last 24 hours, making it the best performer among the top 20 cryptocurrencies by market cap.
• On-chain data, derivatives metrics, and momentum indicators collectively support a positive outlook

Stellar (XLM) is showing strong performance above critical resistance levels on Tuesday, as XLM found support around its respective resistance the previous day. 

With growing on-chain activity, positive derivatives data, and bullish momentum indicators, XLM is poised for potential upside.

Bullish sentiment backed by on-chain and derivatives data

CryptoQuant’s latest summary suggests a neutral to bullish outlook for XLM, highlighting large whale orders and favorable conditions in spot markets.

XLM is showing large whale orders with mostly neutral market metrics, reinforcing a bullish outlook.

On the derivatives front, XLM is displaying positive funding rates. XLM’s OI-Weighted Funding Rate flipped positive on Monday, reaching 0.0032% on Tuesday. This positive rate suggests a bullish market sentiment, with longs paying shorts.

XLM is showing promising signs of continued strength as it maintains momentum toward a potential breakout.

XLM technical outlook: Rebounds from key support

The XLM/USD 4-hour chart is bearish and efficient as Stellar is trading at $0.1815 at press time. The coin found support around the 50-day EMA at $0.165 the previous day. 

XLM is holding a constructive near-term bias as it stabilizes above the 50-day EMA and the broken descending trendline that now offers secondary support near $0.153. 

The current momentum indicators suggest that XLM could rally higher in the near term. The RSI on the 4-hour chart reads 71, just below the overbought territory. The MACD line is tracking above zero, suggesting buyers retain control while price stays capped above the 100-day EMA at $0.179.

If the rally persists, immediate resistance would be found at the 4-hour TLQ of $0.194, followed by a more substantive barrier at the 23.6% Fibonacci retracement of the broader downswing at $0.201.

A daily candle close above these levels would expose the 200-day EMA at $0.215, which defines a key medium-term hurdle.

On the downside, initial support is seen at the 100-day EMA of $0.179, with another major demand zone at the day’s open near $0.173. 

An extended bearish performance would expose the 50-day EMA at $0.165, with deeper protection at the former descending resistance line-turned-support around $0.153.

• Stellar (XLM) shows short-term recovery potential around $0.15–$0.23.
• Oversold indicators suggest a possible upward correction soon.
• Long-term adoption could drive significant value growth.

Stellar has recently shown signs of stabilising after a bearish period followed by consolidation.

The current XLM price hovers around $0.156, reflecting modest upward movement in the past 24 hours.

In addition, the token’s trading volumes remain healthy at nearly $97 million over the last day, signalling that market participants are actively engaging with the token.

Despite the ongoing volatility, the cryptocurrency is demonstrating key technical behaviours that hint at a potential recovery in the short term.

Short-term XLM recovery signals emerge

After a 31% decline in a month, the immediate support zone around $0.15 has been critical in preventing a further downside for Stellar Lumen’s XLM token.

Price action indicates that XLM is testing a make-or-break region, where sellers have been active but not dominant.

Exchange inflows data suggest that some investors are moving coins onto trading platforms, which could temporarily increase selling pressure.

However, technical indicators like the Relative Strength Index (RSI) suggest that the coin is near oversold conditions, often a precursor to upward correction.

If the upward recovery happens, the immediate short-term recovery targets range from $0.18 to $0.23 if the support holds and momentum shifts favourably.

While the XLM price is currently trading below key moving averages, reflecting a cautious outlook, the convergence of indicators points toward a possible stabilisation.

Breaking above $0.18 would signal a strengthening trend and could pave the way for a test of the $0.23 level in the coming weeks.

But until these levels are convincingly breached, bearish pressure remains a concern.

Long-term Stellar growth prospects

Beyond short-term fluctuations, Stellar’s long-term outlook remains compelling.

XLM has historically been tied to cross-border payments and financial infrastructure, which gives it real-world utility beyond speculative trading.

Analysts forecast that as adoption grows, XLM could see substantial appreciation over the next few months, with potential price levels ranging significantly higher than today.

Even modest increases in network activity, stablecoin usage, and partnerships with financial institutions could drive long-term value.

The coin’s past all-time high near $0.88 demonstrates its capacity for growth, despite the current market price being a fraction of that peak.

Stellar’s network fundamentals, combined with increasing adoption of blockchain-based payment solutions, create a foundation for sustained growth.

Investors looking at a long-term horizon may view the current price as an entry point ahead of broader adoption and utility expansion.

While short-term volatility will likely persist, the convergence of recovery signals and long-term adoption prospects creates a favourable risk-reward scenario.

Key takeaways

• XLM is down by less than 1% and is trading below $0.22.
• The coin could retest the $0.20 support level if the bearish trend continues. 

The cryptocurrency market is having a bullish Christmas as Bitcoin and other major cryptocurrencies are in the green. Bitcoin is trading above $87k after dipping below $86k a few hours ago. 

However, some major altcoins, including Stellar’s XLM, are still in the red despite the current market conditions. XLM is trading below $0.22 at press time after failing to close above the key resistance earlier this week.

Bearish momentum continues to grow stronger, with Open Interest (OI) and short bets rising. If the bearish momentum continues, XLM could face further selling pressure in the near term. 

XLM derivatives data suggest bearish sentiment

The primary catalyst behind XLM’s bearish performance is the derivatives and on-chain data. According to CoinGlass, XLM’s futures Open Interest (OI) increased to $112 million in the last 24 hours, up from the $30 million recorded the previous day. 

However, the increasing OI hasn’t reflected in the coin’s performance as it continues to trade below a significant support level. 

Furthermore, Coinglass’s long-to-short ratio for XLM reads 0.91, the highest level in nearly a month. This suggests that despite the surging OI, the bearish sentiment in the market remains, with traders betting on the XLM price rising. 

XLM could dip below $0.20

The XLM/USD 4-hour chart is bearish and efficient as the coin has underperformed in recent days. At press time, XLM is trading at $0.21 and could record further losses in the near term. 

If the bearish trend continues, XLM could retest the December 18 low of $0.20. A close below this psychological level could extend the drop toward the yearly low of $0.16, set on October 10.

The RSI on the 4-hour chart reads 43, below the neutral 50 level, indicating bearish momentum is gaining traction. The Moving Average Convergence Divergence (MACD) lines are also converging, indicating indecision among traders.

On the flip side, if XLM recovers, it could rally towards the key resistance level at $0.22 over the next few hours.

Key takeaways

• Stellar’s XLM is down 3.4% and is now trading around $0.22.
• Derivatives data signals a bearish positional buildup, with further downside expected in the near term.

XLM derivatives suggest further bearish price action

Stellar (XLM) is trading in the red zone for the seventh consecutive day, losing 3.4% of its value in the last 24 hours. The bearish performance comes as the broader cryptocurrency market is bleeding, with XLM now expected to retest the April low in the near term. 

XLM’s derivatives data shows that the bearish trend could grow thicker. Data obtained from CoinGlass shows that XLM futures Open Interest (OI) is in a largely declining trend, at $118.43 million, down from $124.72 million recorded yesterday. 

The declining OI suggests a decline in the notional value of XLM futures, with the total value of all active positions (long and short) currently on the decline. 

With XLM declining,  long liquidations over the last 24 hours totaled $406,740, outpacing short liquidations of $6,040. The long-to-short ratio chart shows that short positions increased to 53.37% today, up from 50.57% recorded on Monday. 

XLM could decline below the $0.20 psychological level

The XLM/USD 4-hour chart is bearish and inefficient as Stellar has underperformed over the last seven days. The coin is currently trading at $0.222, retesting the June low of $0.217.

If the bearish trend continues, XLM could drop below the $0.2001 level marked by the April 7 low. An extended bearish trend could see the cross-border remittance token aim for the support at $0.1642, followed by the annual low of $0.1600. 

Currently, the technical indicators are bearish, suggesting that sellers are in control. The Relative Strength Index (RSI) is at 35, pointing toward the oversold zone. Furthermore, the Moving Average Convergence Divergence (MACD) is falling steeply after crossing below the signal line a few hours ago.

However, if the bulls regain control, XLM could flip the bearish narrative and retest the $0.2579 support-turned-resistance.