Stellar (XLM) Rallies 23%: But Why Are Users Leaving the Network?

The Price vs. Usage Divergence

Stellar (XLM) caught the market's attention this week as its market cap surged by 23%, peaking near $8.60B before settling around $7.11B. On the surface, this looks like a powerful bullish rally. However, a deeper look at the on-chain data from the "Stellar (XLM) Deep-Dive Report" reveals a worrying trend: the network's user base is rapidly shrinking while the price goes up.

• Daily Active Users (DAU): Dropped 44.8% from its weekly peak down to just 39,722.
• Network Operations: Fell 34.2% from its peak, closing at a low of 6.57 million.

This creates a classic "bearish divergence". For a payment blockchain to sustain its valuation gains, higher prices should be backed by growing transaction volumes and active wallets. Instead, network demand is fading.

Technical Outlook: Testing the Golden Pocket

From a technical perspective, XLM is currently sitting at a make-or-break pivot zone. It is hovering at $7.11B, just above the critical 61.8% Fibonacci retracement level ($7.00B)—often called the "golden pocket".

If buyers manage to defend the $6.80B–$7.00B support area, XLM could consolidate and attempt another push toward $7.90B or even retest its recent $8.60B high. On the flip side, a daily close below $6.80B will break the recovery structure, exposing the price to a deeper drop toward $6.33B and $6.00B.

Conclusion

While XLM's price layout remains neutral in the short term, the underlying network participation is weak. Without a quick recovery in active users, this price rally may not be sustainable. Investors should keep a close eye on the $6.80B–$7.00B support zone; losing this line is a clear signal that the rally has run out of steam.