Stellar (XLM) is trading near $0.154 on Tuesday, extending its recent decline as bearish sentiment tightens across the cryptocurrency market. The token has lost more than 2% in the last 24 hours, continuing its slide below the $0.155 level, and now faces a critical test at the $0.14 support zone.
Despite Bitcoin's rally to $64,000 on Monday, XLM has underperformed, with derivatives data pointing to a cautious and bearish outlook. According to CoinGlass, the long-to-short ratio for XLM stands at 0.90, indicating that short positions outnumber long positions. A reading below 1 typically signals that more traders are betting on price declines than advances.
Adding to the bearish picture, XLM's funding rate turned negative on Tuesday, now at -0.0215%. A negative funding rate means short sellers are paying long positions, a sign that bearish traders are willing to pay a premium to maintain their positions. This dynamic often reflects strong downward pressure in the market.
On-chain data from CryptoQuant also suggests a bearish outlook for XLM, similar to what has been observed for XRP. The data indicates sell-side dominance across XLM's markets, with large whale orders contributing to the selling pressure. While major participants remain active, the near-term trend appears controlled by sellers.
The derivative and on-chain signals have supported the bearish price action in recent weeks. While Bitcoin has consolidated between $62,000 and $64,000, XLM has shed 17% of its value over the past month. The token could face further losses if the current trend persists.
Technical outlook: Approaching oversold conditions
On the 4-hour chart, XLM/USD remains bearish, trading below all major daily exponential moving averages (EMAs). The 50-day EMA at $0.173, the 100-day EMA at $0.178, and the 200-day EMA at $0.190 form a significant resistance cluster. As long as XLM stays below these levels, the broader technical outlook remains negative.
The Relative Strength Index (RSI) is near 36, placing XLM close to oversold territory. Meanwhile, the Moving Average Convergence Divergence (MACD) has turned marginally positive around its zero line, suggesting that selling momentum may be weakening. However, neither indicator confirms a sustainable recovery while the price remains below the key moving averages.
On the upside, the first meaningful resistance sits around $0.173, where the 50-day EMA aligns with the 78.6% Fibonacci retracement. Further barriers are located at $0.177 and the 100-day EMA at $0.178. A stronger recovery could target the 200-day EMA at $0.190, followed by Fibonacci resistance levels at $0.200, $0.218, $0.237, and $0.260. The cycle high near $0.298 remains a distant target.
On the downside, XLM could test the support zone between $0.142 and $0.139. A decisive daily close below this range would strengthen the bearish outlook and could trigger a deeper decline. Traders are closely watching this level, as a break could open the door to further losses.
For context, the broader crypto market has shown mixed signals. While Bitcoin holds above $63,000, bearish signals persist, and key support at $62,300 remains critical. Similarly, XRP hovers near $1 as whale accumulation clashes with bearish technicals, reflecting a cautious sentiment across major altcoins.
Investors should also note that gold climbs on Fed pause bets amid geopolitical tensions, which may influence risk appetite in the broader financial markets. As always, traders should monitor key support and resistance levels for XLM and stay alert to any shifts in derivatives data.
This article is for informational purposes only and does not constitute financial advice.
