XLM Nears $0.50 Breakout Amid Bullish Patterns and 80% TVL Surge

Stellar (XLM) has become a focal point for traders and analysts as its price action forms multiple bullish technical patterns in recent weeks. On July 31, XLM displayed a reverse head and shoulders pattern on its daily chart—a strong reversal signal in technical analysis that often precedes a significant upward trend [1]. The pattern, highlighted by analyst ALi Martinez, includes a left shoulder formed in January, a head in late May, and a right shoulder nearly completed in recent weeks. The $0.50 price level serves as a critical psychological and technical marker. A breakout above this level, confirmed by a daily candle close with robust trading volume, could validate the bullish momentum [2].

Just a day before the formation of the reverse head and shoulders pattern, XLM completed a bullish engulfing pattern on July 30—another strong technical signal indicating a potential price breakout [2]. These patterns, combined with XLM’s price hovering near $0.452, have led to speculation that the asset may be on the verge of a meaningful upward movement. If the price follows the trajectory seen in similar assets like XRP earlier in the year, it could reach Fibonacci extension targets of $0.71 and $0.77, depending on the strength of buying interest and volume [1].

Fundamentally, XLM has also seen a significant increase in Total Value Locked (TVL), which hit an all-time high of $152.11 million on July 21—a 80% increase from the $84 million recorded in July of the previous year [3]. This surge in TVL suggests growing trust and usage of the Stellar network, particularly in cross-border payment solutions. The increased demand reinforces the technical optimism and supports the notion that XLM may be entering a phase of renewed bullish momentum.

Analysts have also positioned Stellar as a potential breakout asset for 2025. A report from August 6 highlighted XLM as one of the most promising cryptocurrencies, alongside Solana (SOL) and MAGACOIN FINANCE [6]. Another analysis from August 13 noted that Stellar quietly builds the backbone of global payments, distinguishing itself from more headline-chasing cryptocurrencies [4]. On August 1, an analyst projected that XLM could rise by 11.44%, reaching a price of $0.4475 by the end of August [5].

However, the market remains cautious. Some analysts have warned of a potential “bull trap,” as a reversal in TVL growth could occur if network activity does not sustain the momentum [3]. While the combination of rising TVL and favorable technical indicators continues to draw bullish sentiment, traders are advised to monitor key price levels and volume for confirmation.

As XLM approaches critical resistance, the market remains watchful. A daily close above $0.50 with strong volume could confirm the bullish pattern and open the door to higher price levels. Conversely, a failure to break above this level could result in a pullback to support at $0.40 or even $0.36 [1]. The evolving technical and fundamental dynamics highlight both the opportunities and risks inherent in the fast-paced crypto market, urging investors to stay informed and cautious.

Source:

[1] Stellar's Chart Breakthrough Captivates Cryptocurrency Enthusiasts (https://en.coin-turk.com/stellars-chart-breakthrough-captivates-cryptocurrency-enthusiasts/)

[2] XLM Sets Up for Potential Breakout as Bullish Engulfing Pattern Forms (https://bravenewcoin.com/insights/xlm-sets-up-for-potential-breakout-as-bullish-engulfing-pattern-forms)

[3] XLM Price Prediction: Is Stellar $152M TVL Surge a Bull Signal or Bull Trap? (https://thetradable.com/crypto/xlm-price-prediction-is-stellar-152m-tvl-surge-a-bull-signal-or-bull-trap-0--v)

[4] XLM Coin Price Prediction: Why Stellar Could Be 2025's Hidden Gem (https://thetradable.com/crypto/xlm-coin-price-prediction-why-stellar-could-be-2025s-hidden-gem-3--v)

[5] Stellar (XLM) Price Prediction (https://www.bitget.com/price/stellar/price-prediction)

[6] Chasing a 10x in the Next Bull Run? These Could Be (https://www.mitrade.com/insights/news/live-news/article-3-1030358-20250812)