Stellar's price fell back in the first half of the week, but recovered in the second half and was trading around $0.54 as of Friday. On-chain data shows that XLM’s TVL and open interest interest are rising, suggesting a bullish outlook. The bullish theory will be invalidated if the weekly candlestick falls below $0.43.
Stellar (XLM) experienced a pullback in the first half of the week, but recovered in the second half, trading around $0.54 on Friday after rising more than 170% in the previous week to reach levels not seen in more than three years. are. This bullish outlook is further supported by open interest (OI) and total value locked (TVL) rising to record levels, suggesting further upside.
The stellar bull looks strong
Stellar's price surged more than 170% last week, reaching levels not seen since May 24, 2021. However, XLM faced a pullback earlier this week through Tuesday, but recovered after finding support at the 50% price retracement level at $0.43. It was up more than 8% on Friday at around $0.54.
If XLM continues its upward momentum, it could extend its rally to retest the May 2021 weekly high of $0.79.
However, the Relative Strength Index (RSI) momentum indicator on the weekly chart is at 92, indicating overbought conditions and suggesting the risk of a correction is increasing. A breakout of the RSI from overbought territory could signal a pullback.
XLM/USDT weekly chart
Stellar’s TVL increased from $22.2 million on November 15 to an all-time high of $56.4 million on Friday, continuing to rise since mid-November, according to crypto intelligence tracker Artemis Terminal data.
This increase in TVL indicates increased activity and interest within the Stellar ecosystem. This suggests that more users will deposit and utilize their assets within XLM-based protocols, adding credence to the bullish outlook.
Stellar TVL Chart. Source: Artemis
Stellar’s open interest (OI) also supports the bullish outlook. OI for XLM futures on the exchange rose from $264.4 million on Wednesday to $334.39 million on Friday, according to Coinglass data. An increase in OI represents new or additional funds coming into the market and new purchases being made, suggesting an increase in Algorand prices is coming.
XLM Open Internet Charts. Source: Coin Glass
Despite bullish on-chain indicators and technical analysis, if the XLM weekly candlestick closes below $0.43, the bullish theory will be invalidated and the price will retest the next weekly support at $0.38. leading to a decline.
