Stellar's XLM Plummets to 57% Drop, Mirroring Crypto Market Trends

Stellar (XLM), the digital currency that powers the Stellar network, has recently hit a low of $0.2740, marking its lowest point since February 3rd. This decline represents a 57% drop from the token's peak in November, reflecting broader market trends that have affected even the most prominent cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH).

Historically, XLM and XRP have shown a strong correlation due to their shared origin and role in the crypto industry. Both tokens were created by Jed McCaleb, which has led analysts to anticipate that XLM might also be affected by XRP's current bearish momentum. XRP is currently forming a risky head & shoulder pattern, which generally suggests a downward trend in price. Consequently, XLM may also experience some downward trends in the near future.

At the time of writing, Stellar's fundamentals indicate that the token may continue to decline. Santiment data shows that open interest for XLM has decreased to just 64.5 million, the lowest level since November 2024. Additionally, the social volume metric has dropped to 0.28, lower than the 0.55 level recorded in 2024. Historically, high social volume metrics have been associated with better token performance.

Daily charts of XLM suggest that the token is approaching a death cross, which occurs when the 50-day and 200-day moving averages intersect. Furthermore, the token has fallen below the 61.8% Fibonacci retracement level, indicating a high likelihood that the token may continue to decline in the coming months.