Stellar (XLM) Poised for 45% Rally as Bullish Pennant Forms

Stellar (XLM) has been the subject of intense scrutiny from analysts who are closely monitoring its price movements. The cryptocurrency has recently formed a bullish pennant pattern, which is often seen as a precursor to a significant price rally. This pattern, observed on the two-hour timeframe, suggests that XLM could be poised for a 40-45% increase in value. The formation of this pattern follows a sharp price movement and a brief consolidation period, which is typical of bullish pennants.

Technical analyst Clifton highlighted this pattern, noting that if XLM breaks through the upper trendline of the pennant with a strong green candle, it could trigger a substantial rally. Volume analysis supports this setup, as the price has tightened within the pennant, and trading volume has cooled. This cooling of volume is often a sign that a breakout is imminent. A spike in volume, accompanied by momentum, could confirm the move, with the expected target being near $0.70.

XLM has experienced a remarkable 62% increase in value over the past week, according to CoinGecko. At the time of writing, the token was trading at $0.4722, with a 24-hour volume exceeding $1.7 billion. The token has maintained a steady range between $0.4469 and $0.4809 in the last 24 hours, indicating strong support levels.

This recent price strength follows a longer sideways trend that may now be coming to an end. Market watchers suggest that this new phase could bring sustained bullish action, particularly if key resistance levels are breached. Trader Henry Gray noted that XLM has exited a prolonged sideways phase and is now in retracement. He also highlighted a bullish moving average crossover that signals an uptrend, aligning with broader views that the market structure has shifted.

Another analyst, CW, pointed out that a sell wall remains near the $0.65 level. If the price breaks above this resistance, XLM could face little resistance on its way to $0.70. The current chart setup has garnered the attention of both short-term traders and long-term holders. The next move will depend on whether the price clears the upper pennant line with sufficient volume. If it does, momentum could carry XLM toward new highs.

Until then, investors remain cautious but alert, ready for the next significant move in Stellar’s price. The potential for a 45% rally has created a sense of anticipation among market participants, who are closely monitoring the cryptocurrency's performance. The next few hours could be crucial in determining whether XLM pushes higher or stalls in its current consolidation phase.