XLM Price Prediction: Stellar breaks out, targeting a 25% gain

XLM price pattern follows a clear and definite uptrend before forming.
Stellar serves to connect financial institutions for cross-border transfers.
Need a close above $0.577 on the 12-hour chart to confirm new rally.

XLM price is trying to break out today from a bullish cup-with-handle pattern on a sizeable increase in volume. A close above $0.577 should ignite a rally to at least the measured move target of $0.720, thereby eclipsing the 461.8% Fibonacci extension of the 2019-2020 bear market.

XLM price needs an increase in institutional adoption

Stellar’s blockchain reduces or eliminates the complexity and delays associated with cross-border transfers inherent in the Nostro-Vostro process. The ecosystem’s valuable functionality has yet to be completely felt in the XLM price, partly because it doesn’t command the substantial and sustained institutional support as other cryptocurrencies.

Platforms like Paypal and Square give their users the ability to buy and sell cryptocurrencies from their platform, but operations are primarily concentrated in Bitcoin. It raises the question of whether the institutional community will widely embrace Stellar Lumens outside of Grayscale, which has invested in the digital coin, buying over $6 mln XLM.

On the largest 12-hour volume since February 23, XLM is attempting to begin a new rally into all-time highs. The clear, irrefutable resistance is the convergence of the 78.6% retracement of the February decline at $0.545 and the 361.8% extension of the 2019-2020 bear market at $0.546. A daily close above will release the cryptocurrency to test the all-time high at $0.608.

The measured move target is $0.720, a gain of 25% from the cup-with-handle breakout. It sits just below the 138.2% extension of the February decline at $0.721.

XLM/USD 12-hour chart

A rejection of the breakout could lead to a sharp reversion back to the January high at $0.440, a level that was resistance in March and earlier this month. The next level of support is the confluence of the 50 twelve-hour simple moving average (SMA) at $0.421with the 100 twelve-hour SMA at $0.426.

A total collapse would target another confluence of support, the 50% retracement of the 2020-2021 rally at $0.317 with the February low at $0.314.

Share: Cryptos feed

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.