Stellar Lumens is just starting to inch away from BTC, up a very minor 0.13% in the current market. But things could be just getting start for XLM, with promising signs of a breakout looming ahead following the recent price activity.
Diving into the 2hr XLM/BTC chart we can see a very obvious cup and handle pattern here with a strong resistance at 4,455 Sats/0.5 fib level forming the rim of the cup and a long drawn out U curved price action which touches the lower 2,110 Sats base support and returns back to the earlier resisting level.
We can also see that the final component of the cup and handle pattern has formed during XLM’s recent price action, with a smaller curved sell-off period that briefly swung down to the softer support at 3,684 Sats before returning back to the cup’s rim.
At the present time, XLM is slowing down with trading volumes starting to thin out – the calm before the storm potentially?
Sometimes these cup and handle breakouts take a while to move off the line and we see the assets in question quite often drift into sideways channels between the cup rim and the lower support level, while support rallies to begin the uptrend.
XLM Price Targets
A typical price target for a cup and handle breakout should be the same length as the distance between the rim of the cup and the lower support level.
As you can see in the chart above, the distance between these points is 2,345 Sats which coincides EXACTLY with a retracement to the top 0.0 fib level at 6,800 Sats, from the rim of the cup at 4,455 Sats. This would return an overall gain of 52.46%.
Earlier price targets in the breakout should be expected initially at the 0.236 fib level (5,727 Sats) followed by a correcting price target back along the lower fib 0.382 fib level at 5,008 Sats. This would give us a return of 28.55% and 12.41% respectively from the cup breakout point.