XLM Price Prediction: Stellar Lumens (XLM) Poised to Rally 30% After Bullish Pattern Formation

XLM, Stellar's native token, appeared promising on the price charts and seemed poised for significant upside momentum, at press time.

output: Stellar's native token, XLM, appeared promising on the price charts and seemed poised for significant upside momentum, at press time. It formed a bullish price action pattern on its daily time frame too.

On 12 January, the larger cryptocurrency market showed signs of recovery, with assets such as XRP, Dogecoin (DOGE), Cardano (ADA), and many others recording notable rallies.

Did XLM follow suit though?

Here's a deeper look into the price charts and some of the factors that might be influencing XLM's price action.

Why is XLM rallying?

Well, this potential market shift has started to push XLM towards a positive trajectory after a prolonged struggle throughout December 2024.

Several factors might be contributing to this price action, including technical analysis, institutional interest, and market sentiment.

As mentioned earlier, XLM appeared bullish on the charts, with the altcoin on the verge of breaking out from a bullish head and shoulders price action pattern on the daily timeframe.

According to AMBCrypto's analysis, this bullish pattern's neckline was at $0.456 - A level that has acted as a strong resistance level for the altcoin since the beginning of December 2024.

Now, if we were to consider XLM's recent price action, if the altcoin breaches this resistance or neckline and closes a daily candle above the $0.47-level, there is a strong possibility that it could soar by 30% to hit the $0.60-level in the future.

This bullish outlook is further supported by the improving market sentiment and upcoming political events.

Long-term holders, traders bet on XLM rallying

This bullish outlook also had an impact on the investors and long-term holders, who demonstrated strong interest and confidence in the token, as highlighted by the on-chain analytics firm Coinglass.

In fact, if you take a look at the Spot inflow/outflow metric, you will find figures of $3.05 million.

This finding reveals that long-term holders have potentially accumulated a significant $3.05 million worth of XLM tokens from exchanges in the last 24 hours. This also hints at an ideal buying opportunity and has the potential to create buying pressure.

Besides long-term holders, traders are also showing strong interest in XLM and have been continuously forming new positions.

Data revealed that XLM's Open Interest surged by 27% over the same period. At the time of writing, the long/short ratio had a reading of 1.13, which indicates strong bullish sentiment among traders.

At the time, 53.21% of top traders held long positions while 46.79% held short positions.