In the past seven days, Stellar (XLM) has experienced a significant increase in value, surging nearly 19%. As of now, its market capitalization stands close to $9 billion. Technical indicators are painting a bullish picture, with the Relative Strength Index (RSI) climbing above 70, the Average Directional Index (ADX) signaling rising trend strength, and the Exponential Moving Averages (EMA) lines confirming positive momentum.

Currently, Stellar is maintaining an uptrend and is targeting a key resistance level near $0.30. However, should the support levels falter, signs of overbought conditions might lead to short-term corrections.

The strong bullish momentum in Stellar is evident through its RSI, which has risen to 71.5 from 55.2 just three days prior. This rapid increase underscores heightened buying activity, reflecting increasing investor confidence in XLM's short-term price outlook. Such a swift rise in RSI often signifies robust demand, yet it may also suggest that the asset is nearing overstretched conditions, which could amplify volatility.

The RSI, a technical indicator used to evaluate the strength and velocity of an asset's recent price movements, operates within a range of 0 to 100. Typically, readings above 70 imply that an asset is overbought, while values below 30 indicate oversold conditions. When the RSI surpasses 70, it often serves as a warning that the asset might experience a pause, consolidation, or minor correction due to overheated buying momentum.

With Stellar's RSI now at 71.5, XLM has officially entered overbought territory. This suggests that although bullish sentiment persists, the price becomes increasingly susceptible to pullbacks if momentum wanes or traders start locking in profits following the recent surge.

The Stellar Directional Movement Index (DMI) chart reveals strengthening trend momentum. Its ADX is currently at 37.41, up from 26.56 just two days ago. This sharp rise in ADX indicates that the trend is gaining traction, affirming that market participants are firmly aligned with the current direction.

An ADX reading above 25 generally signifies a meaningful trend, and with XLM's ADX nearing 40, the uptrend is well-defined and gaining power, drawing more interest from momentum traders and technical analysts.

The ADX, or Average Directional Index, gauges the intensity of a trend without indicating its direction. It ranges from 0 to 100. Levels below 20 denote a weak or absent trend, while readings above 25 suggest a strong and enduring trend is in motion.

In conjunction with the ADX, the DMI tracks two additional critical lines: the Positive Directional Indicator ( DI), which measures upward pressure, and the Negative Directional Indicator (-DI), which assesses downward pressure.

XLM's DI is now at 33.59, having been at 22.81 two days ago but slightly lower than its recent peak of 36.47. This shows some short-term volatility despite robust overall buying pressure. Meanwhile, the -DI has plummeted to 9.91 from 19.8 three days earlier, indicating that selling pressure has diminished significantly.

Together, these movements confirm that XLM remains in an uptrend. However, minor fluctuations in DI suggest that while bulls retain control, the pace of buying may encounter brief pauses or small corrections as the rally progresses.

Stellar's Exponential Moving Averages (EMAs) are emitting strong bullish signals, with the short-term EMAs positioned above the long-term ones. This classic configuration reflects sustained upward momentum.

The next major resistance level resides around $0.30, a psychological barrier that might temporarily hinder XLM's progress. Nevertheless, if Stellar successfully breaks decisively above $0.30, the path upward will open toward $0.349 and possibly $0.37, marking the first time XLM trades above $0.35 since March 2.

On the downside, the support level at $0.279 is crucial for preserving the bullish structure. A successful retest of this support could facilitate healthy consolidation before another upward phase, but a definitive breach of $0.279 might trigger a more substantial correction.

If this occurs, XLM's price could descend toward the next major support at $0.258, and if selling pressure intensifies, deeper retracements to $0.239 or even $0.20 could materialize.

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