Triangle breakout imminent: Stellar (XLM) may leverage bullish pattern to challenge $1.51 high.

In July 2025, Stellar (XLM) shocked the market with a 75% rise, with the price soaring from $0.23 at the beginning of the month to a monthly high of $0.51, before entering a technical consolidation phase. As of August 4, the trading price of XLM has stabilized around $0.42, with both bulls and bears fiercely contesting this key price level.

Technical analysts have keenly observed that XLM has formed a bullish pennant on the daily chart—a typical trend continuation pattern. This pattern consists of the previous rapid rise's "flagpole" (the July surge) and the currently narrowing "triangle flag surface."

The upper and lower trend lines of the triangular flag are converging rapidly, indicating that the price is about to experience a directional breakthrough. If the upper resistance is successfully broken, historical data suggests that the upward target can refer to the height of the "flagpole," with a theoretical target pointing towards around $0.73.

Price Trends and Triangle Patterns: A Technical Structure Ready to Explode

The current consolidation of XLM is viewed by the ecological platform Scopuly as a "normal adjustment after a strong rise," rather than a signal of weakness. Key technical indicators also support this view:

• Strong support from moving averages: Prices are firmly operating above the 50-day and 200-day moving averages, indicating that buyers dominate the medium to long-term trend.
• Neutral correction signal: The RSI indicator is at 54.2, having moved out of the overbought zone but not yet entered the oversold zone. Although the MACD shows that short-term momentum is weak, the extent is limited.
• Healthy trading volume: The 24-hour trading volume remains at $28 million, indicating sustained market interest.

The support line of this triangular pattern is currently located in the $0.40 - $0.36 range, while the resistance line has been pushed down to the $0.42 - $0.45 area. The direction of the breakout will determine the market trend in mid to late August.

Market Sentiment: Derivatives Data Suggest Bullish Expectations

On-chain and derivative data further strengthens the possibility of a rise.

• Long-short ratio rises: According to Coinglass, the XLM long-short ratio has reached 1.14, a new high in a month, indicating that more traders are betting on price rise.
• Funding rate positive: currently at 0.0085%, indicating that longs are paying shorts to maintain their positions, which is a typical bullish sentiment signal.
• Retail speculation cools down: CryptoQuant data shows that retail speculation activity in the spot market is at a low level, which historically paves the way for institutional funds to enter, driving trend行情.

Protocol 23 Upgrade: Major Catalysts in Fundamentals

The core focus in August is the upcoming Protocol 23 upgrade, which is widely seen as a potential trigger for a price breakthrough:

• Smart contract capabilities upgraded: The upgrade will significantly enhance transaction speed and reduce costs, directly boosting Stellar's competitiveness in the DeFi sector.
• Key timelines: The testnet has been deployed, and the mainnet validator vote is scheduled for August 26. If approved, it will officially launch on September 3.
• Support from major players: PayPal's stablecoin PYUSD will be deeply integrated into the Stellar network after the upgrade, and Franklin Templeton has completed the tokenization of $446 million in government bonds on that chain.

These real-world application cases provide solid value support for XLM, and are also its core advantage that distinguishes it from pure meme coins.

The Reasonableness of the $1.51 Target: Resonance of Technical Structure and Market Cycles

Although the short-term targets focus on $0.52 (the triangle breakout level) and $0.73 (the flagpole equal length target), the targets of $1.51 and even higher are not fanciful.

• Macroeconomic Cycle Positioning: Veteran trader Peter Brandt pointed out that the XLM weekly chart has formed a potential "ascending triangle" and "cup and handle" patterns, both of which are classic long-term bullish structures. He clearly stated that a breakout above $1 will confirm the start of a multi-year bull market, with medium to long-term targets looking towards the $7.2 region.
• Significance of breaking historical resistance: Since 2018, $1 has been a strong resistance level that has been difficult for XLM to surpass. If an effective breakthrough is achieved through the current technical patterns and fundamental upgrades, the psychological barrier in the market will be breached, and short covering along with new buying may accelerate the price increase.
• Healthy on-chain chips: Currently, over 80% of XLM addresses are in profit, and the proportion of long-term holders (more than 1 year) continues to rise. This "hold tight" chip structure greatly reduces selling pressure, which is beneficial for the continuous rise in price.

Short-term Risk Warning: Key Support Levels Must Not Be Lost

Despite the bright medium- to long-term prospects, traders should be wary of the volatility risks in early August:

• Importance of support level: $0.42 is the current bull-bear divide, and if it is lost, it may drop to $0.38 and $0.35 (50-day EMA).
• Open interest decline: CoinGlass data shows that XLM open interest (OI) has decreased from $588 million on July 18 to the current $351 million, a drop of $237 million. This indicates some leveraged funds are withdrawing, which may weaken upward momentum in the short term.
• Market overall correlation: If Bitcoin experiences a sharp correction, it may cause XLM to briefly fall below the triangle pattern. Investors need to set strict stop-loss orders (e.g., below $0.35) to control risks.

##Future Outlook

As the voting date for Protocol 23 upgrade (August 26) approaches, market attention on XLM is continuing to heat up. If the upgrade passes, Stellar will become a high-performance public chain supporting PYUSD stablecoin cross-border payments and processing tokenized US Treasury bonds, with its valuation logic shifting from "technical experiment" to "financial infrastructure."

The rare resonance between technical and fundamental aspects makes the triangular pattern of XLM no longer just a line game. After breaking through $0.52, $1 will become a key psychological battlefield for bulls. Once breached, historical data shows that $1.51 and even $7.2 will no longer be a fantasy.

The most expensive mistake in the crypto world is often not missing out on a hundredfold coin, but rather discarding chips due to short-term fluctuations before a trend starts.