Stellar Lumens’ price consolidated in January, mirroring the performance of Bitcoin and most other altcoins.
Stellar (XLM) traded at $0.4240 on Friday, down 33% from its peak in November last year when it experienced a strong rally.
Technicals suggests that XLM price may soar in February
Stellar has formed several bullish patterns, signaling the potential for further gains in February. First, the consolidation phase in December and January formed part of a bullish pennant pattern, a widely recognized continuation signal. This pattern consists of a long vertical rally followed by a symmetrical triangle. A bullish breakout typically occurs when the two lines of the triangle approach convergence.
Second, the Elliott Wave formation suggests additional upside potential. This pattern consists of five key phases, beginning with a bullish wave, followed by a corrective pullback. The third wave, which took place in November, is usually the longest, and it was followed by the fourth corrective wave. Based on this structure, Stellar may enter its fifth bullish wave in February.
Third, Stellar has formed a golden cross pattern on the chart, where the 50-week and 200-week moving averages have crossed. The price has remained above these two averages, indicating that bullish momentum remains intact.
Therefore, Stellar may rebound and retest its all-time high of $0.7960 in February, representing a potential 90% increase from its current level.
Potential catalysts for Stellar price
Stellar will likely jump for several reasons. First, historical data shows that February is often a strong month for cryptocurrencies. Seasonal trends indicate that Bitcoin (BTC) and Ethereum (ETH) tend to perform well in February and March. If this pattern holds, other widely followed cryptocurrencies, including Stellar and XRP, could benefit.
Second, Donald Trump is considering focusing on Made in USA coins to appeal to the crypto industry. This move would benefit a coin like Stellar, which was created in the US in 2014.
Further, an XRP ETF approval would be beneficial to Stellar because the two coins are often seen as cousins since they are in the payment industry. Jed McCaleb, its founder, was also part of the Ripple (XRP) team. Therefore, the odds of a Stellar Lumens ETF approval would also rise when that happens.
