Stellar XLM Drops 11% in a Week but Analysts See 20% Rally Ahead

Stellar, a prominent cryptocurrency, has experienced a significant decline in its price over the past week, mirroring the broader downturn in the altcoin market. However, recent technical analysis suggests that Stellar (XLM) may be poised for a substantial bullish rally in the near future.

Prominent crypto analyst Ali Martinez recently shared insights on the potential price movement of Stellar. Martinez highlighted the formation of a descending triangle pattern on the 1-hour timeframe of the Stellar price chart. This pattern is characterized by a diagonal falling upper trendline and a horizontal lower trendline, typically indicating a bearish continuation pattern. However, it can also signal a trend reversal and a bullish breakout.

According to Martinez, the price of Stellar recently found support at the horizontal lower trendline around $0.274, bouncing back toward the $0.28 mark. If the price breaks out of the descending triangle pattern, Martinez expects a 20% upward move, targeting around $0.33. This target is calculated by adding the vertical height between the sloping and horizontal trendlines of the pattern.

A move toward $0.33 could be crucial for Stellar, potentially kickstarting a fresh bull rally. Martinez also noted that the $0.55 mark is a significant level to watch for a sustained bull run. The price of XLM has been rejected at this level multiple times since 2018, but repeated testing of this level could weaken its resistance, making a breakout more likely.

As of the latest data, the price of XLM stands at around $0.276, reflecting a 1.6% decline in the past 24 hours. Over the past seven days, the altcoin’s value has fallen by more than 11%. Despite this recent downturn, the technical analysis suggests that Stellar could be on the verge of a significant price recovery, making it an attractive option for investors looking to capitalize on potential gains.