After breaking out of its five-month downtrend, an analyst suggests a repeat of Stellar (XLM)\u2019s last cycle playbook could be on the horizon. The cryptocurrency has confirmed its breakdown from a bullish reversal pattern and eyes a surge toward new targets<\/p>\n
Amid the market pump, Stellar has broken out of a key demand zone and retested the $0.30 mark for the first time since March<\/a>. The cryptocurrency has been in a downtrend since its November 2024 breakout, when it reached a three-year high of $0.63.<\/p>\n During this year\u2019s retraces, XLM dropped 68% from the highs to a five-month low of $0.20. However, the late-April market recovery saw the cryptocurrency surge above the downtrend and attempt to confirm the breakout after recording a weekly close above the $0.28 mark.<\/p>\n On Friday, Stellar has reclaimed the $0.29 resistance and retested the $0.30 mark for the first time in nearly two months. Following today\u2019s performance, Ali Martinez pointed out that Stellar is breaking out of a two-month inverse head and Shoulder pattern.<\/p>\n This pattern is a bullish reversal setup that suggests a potential shift from a downtrend to an uptrend. Earlier this week, the analyst pointed out that the pattern\u2019s<\/a> right shoulder was forming and the neckline sat around the $0.29 mark.<\/p>\n According to his post, a breakout from this formation potentially eyed a 30% rally toward the $0.39 resistance, lost during the February retraces.<\/p>\n Analyst Rekt Capital highlighted that the cryptocurrency confirmed the end of its multi-month downtrend and a breakout from its Downtrending Channel.<\/p>\n Per the post, if XLM weekly closes above its key area, between $0.27-$0.29, any dips into this zone would figure as a successful reclaim of the area as support to support a move to higher regions.<\/p>\n The analyst explained that reclaiming the $0.27-$0.29 area is crucial because it is a \u201chistorical demand region on the monthly timeframe.\u201d In the past, turning this zone into support during bull markets has enabled Stellar to rally toward the $0.37-$0.40 mark.<\/p>\n In 2021, the cryptocurrency rallied toward its cycle high of $0.80 after retesting the key demand<\/a> zone and breaking out of the $0.37 barrier. Similarly, it hit its all-time high (ATH) of $0.87 after a breakout from this area.<\/p>\n If XLM repeats history and rallies to the next resistance, it must reclaim and confirm that level to continue with its historical tendencies. \u201cAs such, a reclaim could see XLM challenge the $0.52 blue highs over time,\u201d Rekt Capital concluded.<\/p>\nXLM To Repeat Historical Tendencies?<\/h2>\n