Key takeaways
- Stellar (XLM) is trading lower as bullish momentum fades.
- Derivatives data shows a bearish mood, with long-to-short ratios less than 1
- Positive funding rates indicate that traders are still willing to maintain long positions despite the pullback.
Stellar Coin (XLM) remains under pressure on Tuesday as the currency continues its recent declines.
Despite the price weakness, on-chain derivatives and metrics suggest that investor sentiment has not turned decisively bearish.
Instead, market participants appear cautiously optimistic, as traders weigh their expectations of a potential recovery against continued short-term weakness.
Derivatives data shows mixed sentiment
Modern derivatives metrics are providing mixed signals for digital assets. According to CoinGlass, XLM long to short ratio It stands at 0.84, also near a one-month low.
A ratio less than 1 indicates that short positions outnumber long positions, indicating that traders are increasingly betting on further declines.
However, financing rates tell a different story. XLM funding rates are at 0.0058%, indicating that the bulls are still paying the bears.
Positive funding rates mean that traders who hold long positions pay out to those who hold short positions, indicating that bullish positions continue to outweigh bearish conviction among leveraged participants.
The difference between positioning and financing suggests that many investors remain cautiously optimistic despite the recent correction.
Excellent Technical Outlook: XLM holds above a key support level
Stellar Coin continues to trade above its short-term moving averages, maintaining a modest bullish bias despite recent weakness.
XLM is currently trading near $0.193, holding above the 50-day EMA at $0.1922 and the 100-day EMA at $0.1872.
However, the token remains set below the 200-day moving average at $0.1985 and the 61.8% Fibonacci retracement level at $0.2001.
These levels represent immediate resistance to the current recovery attempt. Technical indicators continue to lean slightly positive. The RSI remains near 48, reflecting the downward momentum, while the MACD remains above the zero line, indicating that the underlying upward momentum has not completely faded yet.
If the bulls regain control, XLM could rise towards $0.1985 (200-day EMA) and $0.2001 (61.8% Fib retracement).
Closing the daily candle above these levels will allow XLM to extend its rally towards the $0.2188, $0.2376, and $0.2607 resistance areas.
However, if the downtrend continues, XLM price could fall below $0.1922 (50-day EMA) and $0.1872 (100-day EMA) in the near term.
A decisive close below these levels will expose lower demand areas at $0.1774, $0.1735 (78.6% Fibonacci retracement), and $0.1421 (key structural support).
Stability above the 50-day EMA will help sustain XLM’s near-term recovery, while a break below $0.1872 could shift momentum back in sellers’ favor.
