Stellar’s DTCC partnership sparks 44% XLM rally — What’s next?

Stellar’s native token XLM rallied by 44% this week after the chain was selected by the Depository Trust and Clearing Corporation (DTCC) for its tokenization plans. 

The DTCC is the clearing and trade settlement house for global financial markets. The firm’s custodied assets will be tokenized and made available on Stellar from early 2027. 

Commenting on the update, Denelle Dixon, CEO and Executive Director of the Stellar Development Foundation, said the chain is meant for this. He added, 

Stellar’s proven compliance-minded architecture, open infrastructure, and risk management capabilities are aligned with market demands and expectations.

What’s next for XLM?

Following the update on Wednesday, XLM pumped by 11%. It has since extended the rally from $0.15 to over $0.20, bringing weekly gains to 44% at the time of writing. 

On the daily chart, the rally had climbed above the 200-day SMA (Simple Moving Average), suggesting that the market structure had effectively been flipped to bullish. 

However, this can only be confirmed if the weekly candle also closes above the key level, alongside the 2025 support at $0.21. If these levels are decisively flipped into support, then bulls could eye $0.26 or about 31% potential upside from the 2025 support level. 

The bullish outlook would be invalidated if the price falters at the 2025 support level and weekly candlestick closes below the 200-day SMA (blue). Such a scenario would imply a profit-taking activity that could erase recent gains. 

Possible XLM consolidation around $0.20

Based on the liquidations heatmap, there may be more liquidity pools below the current price action than above it. The immediate pools seemed to be at $0.19, which aligned with the 200-day SMA. 

Another pocket of liquidity was at $0.15, the level that triggered this week’s rally. These are leveraged long positions, and could be levels of interest in case of volatility. 

For late bulls seeking a new entry, the cue would be if the 2025 support is decisively reclaimed and defended.

Otherwise, a weekly close below $0.19 could attract short sellers, especially if the current market correction extends into early June. 

Final Summary

• XLM has rallied by over 40% this week following the DTCC partnership for tokenization of its custodied assets. 
• Any extended uptrend momentum could only be confirmed if XLM bulls keep the price above $0.21.