Stellar’s XLM Primed for a Spectacular Rally – Here’s Why

Stellar’s XLM is flashing bullish signals—again. The cross-border payments token, often overshadowed by its bigger rivals, is showing technical and fundamental strength that could send it soaring.

Key Drivers Behind the Move

Network upgrades and surging adoption in emerging markets are fueling optimism. Unlike some ‘ghost chain’ projects (looking at you, vaporware DeFi tokens), Stellar’s real-world utility is hard to ignore.

Market Sentiment Shifts

Traders are piling in as XLM breaks key resistance levels. The charts hint at a potential replay of its 2021 bull run—back when crypto was simple and ‘institutional adoption’ wasn’t just a buzzword to pump bags.

Bottom Line: If the macro winds stay favorable, XLM might just cut through the noise—and the competition.

XLM Forms Bullish Pennant as Traders Bet Big on Breakout Rally

On the one-day chart, XLM has formed a bullish pennant. This pattern emerges when a strong upward price movement (flagpole) is followed by a period of consolidation that resembles a small symmetrical triangle (the pennant). 

This pattern usually suggests that buyers are temporarily pausing before potentially continuing the uptrend. Traders often look for a breakout above the pennant’s upper trend line as a signal to enter a long position.

On-chain data confirms the likelihood of an XLM upward breakout above this pennant in the NEAR term. For example, the token’s funding rate remains positive, indicating the demand for long positions. Per Coinglass, this is at 0.0152% at press time.

The funding rate is a periodic fee exchanged between long and short traders in perpetual futures markets. It keeps contract prices aligned with spot prices. A positive funding rate means traders are paying a premium to hold long positions, indicating bullish market sentiment.

For XLM, the positive funding rate shows that its futures traders are leaning heavily toward long positions. This reinforces the bullish pennant setup, signaling confidence in a continued price rally.

XLM’s Bullish Pennant Points to Massive Move

These indicators signal that XLM may be preparing for a fresh leg of gains. If demand strengthens and XLM successfully breaks out of the bullish pennant pattern, traders can expect a strong upward move.

Usually, when an asset breaks out of this pattern, its price is expected to grow by the length of the initial price surge—or “flagpole”—that preceded the pennant formation. This means that XLM’s price could potentially climb to $0.73.

However, if market sentiment shifts from bullish to bearish, XLM’s value may break below the pennant and fall to $0.39, invalidating the bullish outlook above.