Stellar holds a bullish bias as momentum indicators improve

Key takeaways

• Stellar continues consolidating between its 50-day and 100-day EMAs. 
• CryptoQuant data suggests a neutral-to-bullish outlook for XLM.

On-chain and derivatives data support a mild bullish outlook

Stellar traded cautiously on Tuesday, but improving on-chain activity and derivatives positioning continued to support expectations for a potential upside breakout in both altcoins.

According to CryptoQuant summary data, Stellar reflects buy-side dominance with largely neutral market conditions, pointing to a mild bullish bias despite the lack of a decisive breakout.

CoinGlass data shows the OI-weighted funding rates for XLM flipped positive on Friday and remained positive on Tuesday at 0.0030%, respectively. Positive funding rates indicate that long-position holders are paying shorts, reflecting growing bullish positioning among traders.

Stellar technical outlook: Consolidation continues between key EMAs

The XLM/USD 4-hour chart is bearish and efficient as it is currently trading at $0.164 per coin. It is currently trading between major moving averages as traders await a clearer directional move.

XLM continues to hold above its 50-day EMA near $0.165 but remains below the 100-day EMA at $0.174 and the 200-day EMA around $0.204. Broader descending trendline resistance also continues to cap upside attempts.

Momentum indicators nevertheless show early signs of improvement. The RSI sits near 57, slightly above the neutral midpoint. The MACD line remains marginally above zero, suggesting mild bullish momentum.

If the rally resumes, the bulls would encounter resistance at key levels, including the 100-day EMA at $0.174, the 23.6% Fibonacci retracement at $0.201, and the 200-day EMA just above $0.204.

However, if the bearish trend persists, immediate support would be seen at the 50-day EMA at $0.165. A daily candle close below this level would expose the major support at $0.136.

As long as XLM maintains support above the 50-day EMA, the current consolidation structure could support a gradual recovery attempt. However, a breakdown below $0.136 would likely reopen the broader bearish trend.