Stellar (XLM) enjoyed a strong rally in late 2024 in many ways, mirroring the surge of another popular cryptocurrency: XRP.
Indeed, XLM was noted for showing more volatility and stronger directional movements as it soared 522.22% from approximately $0.09 just ahead of the U.S. presidential election to December 1 highs at about $0.56.
In recent times the token has been struggling to decisively breach $0.35 – despite coming close with its press time price of $0.34.
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On February 21, however, the on-chain expert Ali Martinez shared a technical analysis (TA) of the cross-border payments token in an X post, indicating that the cryptocurrency might soon see its rally reignited.
Why XLM is facing an imminent rally
Specifically, Martinez explained that TD Sequential, a tool developed by the famous analyst Tom DeMark that utilizes an asset’s historical performance to determine if a current trend would be maintained or reversed, has issued a buy signal on XLM’s hourly chart.
Though the on-chain expert and cryptocurrency trader provided no insights into how high the token might go, XLM’s February 21 support and resistance levels indicate that it is likely to halt near $0.351 and almost certain to remain below $0.36.
Finally, XLM’s relative correlation with XRP appears, at press time, to confirm the bull case for the cryptocurrency. Specifically, the same technical analysis tool signaled an XRP rally earlier in the day and, indeed, the token soared from $0.65 to $2.70 within hours.
Is XLM headed for a long-term rally?
Following the same logic, Stellar’s long-term prospects also appear bright as Ripple Labs’ token appears to be enjoying important external tailwinds with the Securities and Exchange Commission acknowledging an exchange-traded fund (ETF) filing – a small but important victory – and with Brazil approving the world’s first spot XRP ETF.
There have also been more Stellar-specific developments that, though bullish at face value, might face varying investor reactions.
Late on February 19, Denelle Dixon, the CEO and Executive Director of the Stellar Development Foundation, made an X post revealing the network is ‘feature complete’ for the next decade after about ten years of work.
Stellar also promised that ‘feature complete’ does not mean an end to innovation, and the accompanying roadmap – focused on scaling and achieving $1.5 billion in total value locked (TVL) – stated the Foundation would declare victory only when more developers see it as the top DeFi platform.
Still, vigilance remains important since, as much as XLM has been linked to XRP in its performance, both have been sensitive to the wider movements of the cryptocurrency market, which has itself been buckling due to multiple external shocks that emerged in recent weeks.
Featured image via Shutterstock
