XLM holds above key moving averages as long-to-short ratio rises to 1.15, indicating increased bullish positioning from derivatives traders.
Crucial highlights:
On Tuesday, Stellar's XLM continued to trade above key support levels, keeping the chance of additional gains alive even as momentum indicators remain mixed.
Derivatives data also pointed to a growing bullish bias for the cryptocurrency. Positive funding rates and climbing long-to-short ratios suggest a greater number of traders are preparing for a price increase.
According to CoinGlass data, XLM's long-to-short ratio was 1.15 on Tuesday, close to its highest reading in one month.
When the ratio exceeds one, it indicates long positions outnumber short ones. The recent rise therefore implies that derivatives market participants anticipate higher XLM prices.
Funding rates offer additional confirmation of bullish positioning. XLM's funding rate turned positive on September 2 and later rose to 0.0147%.
A positive funding rate means long position holders are paying short traders to keep the market balanced.
Although this typically indicates bullish sentiment, a rate that becomes too high may eventually raise the risk of long liquidations if the price drops abruptly.
The current readings back a constructive outlook without suggesting that positioning has become extreme.
On Tuesday, XLM was trading near $0.193 after moving above its key exponential moving averages.
The 50-day, 100-day and 200-day EMAs are clustered around $0.179 to $0.188. This grouping currently creates a possible demand area that could draw in buyers during brief dips.
XLM's RSI is close to 60, holding the indicator in bullish territory without being overbought.
The MACD also shows a mildly positive reading, with its main line above the signal line and the histogram above zero. This configuration indicates that upward momentum is still constructive, though buyers have not yet achieved a clear breakout.
The first major resistance for XLM is at the 61.8% Fibonacci retracement around $0.200.
A prolonged move above that psychological and technical level could enable the price to test the 50% retracement near $0.218. After that, resistance is at the 38.2% Fibonacci level around $0.237.
Breaking through those levels could clear the way to the descending trendline and the 23.6% Fibonacci retracement near $0.260.
To the downside, immediate support is provided by the 200-day EMA at $0.188. Further support comes from the 100-day and 50-day EMAs around $0.180 and $0.179.
If sellers drive XLM beneath this cluster of moving averages, the horizontal support at $0.177 and the 78.6% Fibonacci retracement at $0.173 would become important.
Buyers must defend that zone to preserve the broader recovery. A clear breakdown could reveal deeper support at $0.142 and $0.139.
In summary, derivatives positioning and technical support point to further gains for both XRP and XLM. Confirmation, however, will need XRP to break above $1.90 and XLM to achieve a sustained move above $0.20.
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Disclaimer: this article comes from third-party media and is provided for reference only. It does not constitute investment advice. Crypto and other financial products carry significant price volatility risk, so please make your own decisions carefully.
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