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Stellar (XLM) has joined the list of underperforming altcoins in 2025, with a year-to-date (YTD) loss of nearly 40%. Most of the downturn occurred in the past quarter, dragging the token from a yearly high of $0.50 to a low of $0.22. However, in the last 24 hours, XLM has staged a modest comeback, climbing 7% to trade around $0.26. While this appears encouraging, technical and on-chain data suggest the rally may soon lose steam.
XLM recently broke out of a falling wedge—a bullish reversal pattern characterized by narrowing downward trendlines. Although the breakout hints at a potential extended rally, indicators suggest that buyers lack full control. One such metric is the Chaikin Money Flow (CMF), which remains below zero despite the price increase. A negative CMF implies that selling pressure still dominates, casting doubt on the sustainability of the uptrend.
Adding to the bearish case is the Average Directional Index (ADX), which has turned downward. A falling ADX reading signals weakening trend strength, meaning XLM’s recent bounce may lack the momentum needed to retest the key $0.30 resistance level.
Sentiment analysis reinforces this cautious outlook. According to data from Santiment, Stellar’s Weighted Sentiment remains in negative territory. Despite the price uptick, online chatter around XLM remains mostly bearish—an indicator that investor confidence is yet to recover.
Should these trends persist, XLM risks sliding back to the $0.22 support zone. For a bullish continuation, indicators like the CMF must rise above zero to confirm sustained buying interest. Likewise, a stronger ADX reading could revive the uptrend, setting the stage for a potential retest of $0.30.
Until then, traders should remain cautious. While the recent breakout is technically promising, weak buying pressure and bearish sentiment suggest that XLM’s recovery may be short-lived.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
Also Read: Stellar Lumens Surges Toward Top 20—Here’s Why XLM Could Hit $1 This Year
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
