XLM and ALGO Making Recovery From Recent Lows – Is a Trend Reversal on the Horizon?

Date: Tue, February 11, 2025 | 12:05 PM GMT

The cryptocurrency market is showing signs of a comeback, with major altcoins recovering from recent lows. Over the past 48 hours, several tokens have rebounded, fueled by a slight decline in Bitcoin (BTC) dominance, which dropped by 0.61% today. The recent correction was largely triggered by the Deepseek launch and tariff-related actions from Donald Trump, which dampened market sentiment.

Among the recovering assets, Stellar (XLM) and Algorand (ALGO) are making notable moves. Both cryptocurrencies have climbed by over 5% in the last 24 hours, following their respective 30-day declines of 22% (XLM) and 17% (ALGO).

Source: Coinmarketcap

Stellar (XLM)

XLM’s daily chart reveals a bull flag pattern, formed after a sharp rejection from its November 24 high of $0.63, following a 600% rally. The subsequent correction pushed XLM down to $0.26, where it found support at the lower trendline of the bull flag.

Stellar (XLM) Daily Chart/Coinsprobe (Source: Tradingview)

Currently, XLM is rebounding towards $0.33, bouncing off both the flag support and the 150-day SMA. This price action signals renewed bullish momentum. Additionally, the MACD indicator is showing a bullish crossover, further reinforcing the case for a potential uptrend.

If XLM can sustain this momentum, it will first face resistance at the 100-day SMA. A successful breakout from this level would trigger a retest of the upper boundary of the bull flag near $0.43. If buying pressure continues, a breakout above $0.43 could open the doors for a further rally towards $0.63 in the coming weeks.

Algorand (ALGO)

Similar to XLM, Algorand (ALGO) is also forming a bull flag pattern. The token faced a sharp rejection at $0.61 on December 3, following a 460% rally. However, the correction that followed pushed ALGO down to $0.263, where it found support at the flag’s lower trendline.

Algorand (ALGO) Daily Chart/Coinsprobe (Source: Tradingview)

Currently, ALGO is rebounding to $0.30 after bouncing from the support of the flag along with the 200-day SMA. This signals a possible bullish reversal. The MACD indicator is showing a bullish crossover, indicating growing buying interest.

If ALGO sustains its current momentum, the next major resistance is the 100-day SMA. A breakout above this level would signal a retest of the upper resistance of the bull flag near $0.39. If ALGO successfully breaks above this structure, the next target would be the December high of $0.61, confirming a full recovery.

Is a Trend Reversal on the Horizon?

Both XLM and ALGO are showing resilience at their respective support levels, hinting at a possible trend reversal. However, their next moves depend heavily on the broader market, especially Ethereum (ETH) and BTC dominance.

If ETH continues its recovery and BTC dominance declines further, altcoins like XLM and ALGO could gain additional momentum. A successful breakout from their respective bull flag formations would confirm a shift towards a bullish trend.

For now, traders should monitor key resistance levels and trading volume to determine whether this recovery has the strength to develop into a full-fledged trend reversal.

Final Thoughts

With both XLM and ALGO bouncing off their support zones and key moving averages, the next few days will be crucial in determining their direction. A breakout from the bull flag formations could trigger strong bullish momentum, but failure to sustain above key resistance levels may lead to further consolidation.

Disclaimer: This article is for informational purposes only and should not be considered financial advice. Always conduct your own research before making investment decisions.