Entering 2026, Stellar (XLM) continues to show a weak market performance. Over the past three months, XLM has retraced approximately 34%, with the overall trend under pressure. However, recent price fluctuations have noticeably converged, the short-term decline has slowed, and signs of stabilization are beginning to appear. In contrast to the price action, the real usage data of the Stellar network is steadily improving.
On-chain data shows that the actual weighted asset value related to real-world assets (RWA) within the Stellar ecosystem has approached the $1 billion mark. Since the end of December 2025, this indicator has risen from about $890 million to nearly $986 million, an increase of over 10% in a short period. This change indicates that funds have not exited due to the price decline but are instead continuing to flow into the network.
From a technical perspective, the XLM daily chart is forming an inverse head and shoulders pattern. The left shoulder formed in November 2025, the head appeared in late December, and recent retracements are gradually outlining the right shoulder. This pattern typically appears near a bottom phase, reflecting diminishing selling pressure and early buying interest. The current neckline is about 12% above the current price. Once the daily chart effectively breaks above this area, a technical breakout will be confirmed.
The capital flow indicators further reinforce this structure. The Chaikin Money Flow (CMF) remained above zero during the price correction, indicating no significant outflow of funds from the market. Meanwhile, the Money Flow Index (MFI) maintained a high level when prices previously made new lows, reflecting typical dip-buying behavior. As long as key support levels are not broken, such buying activity will continue to support the price.
Looking at key price levels, if XLM’s daily close breaks above the $0.254 region, the technical target will point toward around $0.33, corresponding to approximately 30% above the neckline. Conversely, if it falls below $0.223, the current bullish structure will weaken, and further decline could invalidate this pattern.
Overall, the growth of RWA within the Stellar network, ongoing capital inflows, and clear technical structures are laying a potential foundation for a bullish turn for XLM. The market’s next focus is whether the price can realize the positive signals released by on-chain fundamentals.
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