Coin WorldMonday, Jul 14, 2025 10:12 pm ET

2min read

Stellar's XLM token has recently experienced a notable rally, with its price surging by 24% to 25% within a 24-hour period. This surge was part of a broader trend where mid-cap cryptocurrencies, including Cardano (ADA), saw significant gains. The rally pushed XLM to a 24-hour high of $0.5166, but the momentum began to wane shortly thereafter. The token pulled back and stabilized at a key demand zone near $0.4800, where bulls are currently defending the price level. This stabilization suggests that the bullish momentum may be exhausting, and a pullback could be imminent.

The recent price action of XLM mirrors a historical pattern observed in November 2024, when the token experienced a 600% surge within just 30 days. Following such a dramatic rally, it is not uncommon for the price to consolidate or correct. The current stabilization near $0.4800 indicates that buyers are attempting to hold the price at this level, but the sustained rally may have left bulls exhausted. This exhaustion, coupled with the historical precedent, suggests that a pullback could be on the horizon.

The technical analysis of XLM's price movement reveals that the token recorded significant price appreciation during a 24-hour trading period from July 11 at 17:00 UTC to July 12 at 16:00 UTC. This period of rapid growth was followed by a pullback, which is a typical pattern in the cryptocurrency market. The current stabilization at $0.4800 is a critical juncture for XLM, as it will determine whether the token can maintain its upward trajectory or if a correction is necessary.

The weekly chart of XLM showed a firmly bullish structure. The first bullish structure break occurred in May. A higher high at $0.334 was established later that month, and a higher low at $0.216 was set in June. The past week’s trading saw XLM rocket past the $0.334 high, challenging the $0.515 level from early 2025. This was a strong sign of bullish conviction, but the rejection measured just over 11% at the time of writing. This could see XLM correct further. How deep should you expect the dip to go?

Based on the recent rally from $0.216 to $0.516, a set of Fibonacci retracement levels were plotted. On the higher timeframes, the XLM structure was firmly bullish. Even a retracement as deep as $0.28 would maintain the bullish weekly structure. However, it did not seem likely that the dip would extend that far. The prime suspect for the next demand zone was the highs set in February at $0.364. This area coincided with the 50% retracement level of the recent rally. Therefore, traders can wait for a dip before buying.

The technical indicators on the daily timeframe did not show a pullback was imminent. The A/D soared higher to set new highs, reflecting intense demand in recent days. The CMF also showed remarkable capital inflow recently, with a reading well above +0.05. The liquidation heatmap indicated pockets of liquidity to the south. Long liquidations were present from $0.445 to $0.395. To the north, a liquidity cluster had built up just above $0.51. Traders must manage their risk carefully and understand that these market conditions would not see much consolidation. Rather, liquidity would be key, and the price could gravitate to nearby magnetic zones without much sideways price action, since speculative interest in these conditions was so high.

Stellar and the rest of the crypto market remained bullishly biased, as Bitcoin was in price discovery mode and witnessed high bullish conviction. Ethereum, the altcoin market leader, was also set to rally further. A structurally driven divergence could see ETH climb to its ATH before the end of the year. The Altcoin Season Index, which provides real-time insights into whether the cryptocurrency market is in an altcoin season, has been closely watched by traders. While the index does not directly influence the price of XLM, it serves as an indicator of broader market sentiment. The recent gains in mid-cap cryptocurrencies, including XLM, suggest that the market may be entering an altcoin season, where smaller-cap tokens outperform larger ones. However, the exhaustion of bulls and the potential for a pullback could temper this optimism.