- XLM is closing out its most bullish week and is on track to make November its most bullish month.
- Derivatives demand is rising to new highs, helped by news supporting incoming organic utility.
Stellar’s [XLM] native cryptocurrency is making headlines with its dazzling rally. Its performance so far this month has allowed the coin to go from undervalued to one of the best performing coins of 2024.
XLM posted an impressive 61% increase from lowest to highest price on Saturday, November 23rd. This allowed it to expand its weekly gains to 235%.
It has risen 600% from its lowest to its highest price so far this month, making it one of the best performing top coins.
Source: TradingView
Although XLM appears to defy gravity, its parabolic performance was also remarkable for another important reason. The cryptocurrency was trading close to its historic lows in early November. However, the impressive rally came closer to the 2021 ATH.
XLM derivatives rise to historic levels
Speaking of record highs, XLM has achieved a new ATH in one key area that underpinned the recent demand tsunami. XLM’s open interest on exchanges rose to $443.99 million in the past 24 hours.
This was the highest open interest level the cryptocurrency has reached in its history.
Source: Coinglass
In comparison, the previous peak of open interest was $180 million in April 2021. XLM derivatives trading volume increased to as high as $180 million. $10.17 billion in the past 24 hours according to Coinglass.
The huge spike in open interest, combined with robust demand for spot prices, was the perfect cocktail for an explosive rally. However, there were other factors that may have contributed to the sudden shift in sentiment.
Stellar Lumens to support the Federal Reserve’s FedNow system
Just two days ago, reports emerged showing that XLM’s native blockchain Stellar Lumens was the FedNow initiative. This means that the network could experience a massive increase in utility, which could also lead to increased demand for the token.
This may have been one of the reasons for XLM’s explosive demand and higher price tag towards the end of the week.
It also supports the potential for more demand in the coming weeks. This is because such news could encourage more HODLing in anticipation of higher prices.
Read Stellar’s [XLM] Price forecast 2024–2025
Nevertheless, a near-term pullback could be on the cards. The main reason for this is that the cryptocurrency was extremely overbought at the time of writing.
However, based on XLM’s recent performance, it is possible that it could expand its price action into price discovery in 2025 and perhaps even sooner than that.
