Why has Stellar’s XLM risen by over 50% in the last week?

Stellar’s native token, XLM has rallied over 50% in this week. This is outperforming the broader cryptocurrency market which declined by almost 5% during the same time period.

The key takeaways

• The US financial giant DTCC has announced that it will integrate its tokenized security platform with Stellar Network.
• XLM gained over 50% in value after the announcement. However, the risk of a steep decline is imminent.

DTCC Partnership Fuels XLM Rally

XLM’s prices surged in response to a significant announcement made by the Depository Trust & Clearing Corporation (DTCC)The US giant in the financial industry clears, settles and processes $10 trillion to $12 trillion worth of securities trades every day.

It is not a Wednesday press releaseThe firm announced plans to integrate their tokenized securities platform into the Stellar Network, with a target launch date of the first half 2027.

XLM/USD Daily Chart. Source: TradingView

This move is based on DTCC’s multi-chain strategy, which was launched in July of 2026. It includes tokenized assets, reporting, actions by corporations, and settlement.

XLM rose 51.75% following the DTCC’s announcement. It traded as high as $0.00224 on Friday. This was its highest price since January. The trading volume increased sharply along with the upward move, indicating that buyers were active.

Short squeeze fuelled XLM’s price rise

The XLM move up was also aided by a crowded trade of shorts. Stellar liquidations of shorts have reached $12.41m since May 28 compared to $6.82m in liquidations for longs, says CoinGlass.

Stellar total liquidations chart vs. XLM price. CoinGlass is the source.

XLM jumped from about $0.15 to even $0.224. That’s nearly 1.8 times as many forced closings for bearish than bullish trader.

XLM’s open interest almost doubled in the same time period and reached $292.11 millions on Friday. This shows that traders increased their leverage during the rise of the market, rather than simply closing out positions.

Stellar open interest vs. XLM price. CoinGlass is the source.

XLM’s OI-weighted financing rate fell to around -0.0270% – its lowest level since April despite the rise in price.

Source: CoinGlass. CoinGlass

Short traders are paying long traders in order to maintain their position. This shows that there was a lot of bearish positioning during the breakout.

Exchanges will force traders who are bearish to purchase the token in order to close out their positions when the price increases against highly leveraged shorts. The forced purchase adds upward pressure to the market. “short squeeze.”

XLM, PayPal and Trump rallies increase the risk of a sharp drop in XLM.

Stellar’s breakout mirrors earlier XLM rallys that finished with steep corrections.

XLM increased by approximately 640% in November 2024 after Donald Trump was reelected as US President. The rally lost its momentum quickly, and XLM dropped by 68.6% in the end from its peak.

XLM/USD two-week chart. TradingView

In July 2025, a similar scenario played out. PayPal’s stablecoin XLM’s rally was boosted by 140% after the launch of Stellar, and the growing interest in Protocol 23.

The XLM/USD exchange rate corrected by 73.8%.

There is a risk that DTCC’s rally will follow the same path.

XLM has run into strong long-term resistance

XLM’s recent rally has pushed it into a significant long-term support zone. This raises the possibility of a consolidation or pullback.

As of Friday, XLM was trading near the $0.198–$0.224 ceiling area, and a zone that also overlaps with three exponential moving averages (EMA), namely the 50-week EMA (red) near $0.2216, 100-week EMA (purple) near $0.2281 and 200-week EMA (blue) near $0.2083.

Weekly price chart for XLM/USD. TradingView

Analyst MAGIC: Failure to overcome the confluence of resistance called “too strong for the first test,” risks sending the XLM price toward the $0.112–$0.136 area, down 30%–40% from current levels, by June or July.

The target is aligned with the trendline at the bottom of XLM’s dominant descending channel pattern.

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Conversely, a decisive breakout above the resistance area raises the odds of XLM rallying toward the channel’s upper boundary near the $0.28–$0.30 range by June or July. This is an increase of roughly 40% from current prices.