XLM price is still trading below its historic ATH achieved in 2021 but it just hit a new ATH in terms of open interest. The cryptocurrency has been experiencing a massive wave of demand with a significant chunk of it coming from the derivatives market.
Coinglass data revealed that XLM futures open interest on exchanges soared as high as $420 million in the last 24 hours.
For context, XLM-related futures open interest has so far outperformed its previous high of $180 million observed in April 2021.
This underscored the level of demand that has prevailed so far this month especially in the derivatives segment. On top of that, the cryptocurrency’s derivatives trading volumes peaked at $10.17 billion on 24 November.
XLM Price Closes in on its Previous ATH
XLM just concluded its most bullish week of 2024. The cryptocurrency rallied by 53.52% on Saturday, resulting in a 189% total weekly gains. The bulls launched an epic charge so far in November which has for the most part been devoid of bearish resistance.
XLM extended it upside in the last 24 hours, soaring to a $0.63 price tag at its peak in the last 24 hours. This was its highest price tag so far in 2024. However, it pulled back slightly to its $0.54 press time price tag.
The bullish assault and press time price tag meant that the cryptocurrency was only a 47% gain away from a new ATH. An interesting outcome considering that just 3 weeks ago it was just 20% away from its lowest price point in 2024.
This abrupt change was courtesy of its over 600% rally so far this month. An outcome that has propelled XLM into the list of best performing cryptocurrencies of 2024.
Will the rally pave the way for intense profit-taking? XLM’s pullback from its recent top is already enough evidence that profit-taking had already commenced. There is a significant chance that this pullback could shave off more of the recent gains in the coming days.
On the other hand, XLM could still be due for more upside in the coming months. Many analysts anticipate a bullish outcome for most coins in 2025. These expectations may encourage XLM holders to continue HODLing in anticipation of higher prices.
Stellar Lumens’s dealings with the Federal Reserve
There is one major reason adding to the incentive to HOD. The U.S Federal Reserve has reportedly selected Ripple and Stellar Lumens as supporting infrastructure for its FedNow system.
The FED recognized Stellar Lumens as one of the most efficient blockchain networks in terms of speed and low fees. These qualities reportedly fit the bill for its FedNow initiative.
More importantly, the development could pave the way for more organic demand for the XLM cryptocurrency. An outcome that could raise its floor price and build on the current demand.
This development is also expected to provide more publicity for the Stelllar Lumens network. In other words, it could potentially pave the way for more adoption in the future.
Regardless of these outcomes, the market will undoubtedly yield directional volatility. Major pullbacks will thus be part of the game moving forward.