The price of Stellar XLM has warmed up over the past 24 hours; however, the technical indicators still show some bullish reversal signs. Traders are focused on the critical support level at $0.40 to maintain the upward momentum, making the targets of $0.5666, $0.6242, and $1 the center of attention.

Analysts point out that strong technical patterns and increasing blockchain adoption are driving the rise of XLM.

XLM price technical analysis

The breakout from the descending wedge is a key point in the price trend of XLM. The $0.40 level is a good entry point for buying, with potential targets at $0.5666, $0.6242, and $1. This setup is a bullish continuation, meaning that a breakout above the $0.45 level would indicate the continuation of the upward trend.

If this trend continues, XLM could reach a 52-week high. They point out that this breakout aligns with the market's generally positive sentiment towards major altcoins, especially those that can be used in the real world, like Stellar.

Formation of bullish flag for XLM

The XLM/USDT 4-hour chart shows a bullish flag pattern, which is a reliable continuation signal.

This formation consists of a sharply rising trend (known as the flagpole), followed by a consolidation phase between two downward-sloping trend lines. This setup indicates that, once the consolidation ends, the price is likely to break out in the direction of the previous trend.

Based on the height of the flagpole, the chart predicts the next target at $0.50. Additionally, the RSI is at 46.50, turning upward from the neutral zone, indicating increased buying interest. These signals suggest that if the price breaks above the upper boundary of the flag, there is a significant chance for further upward movement.

Key support and resistance levels for XLM tokens

As XLM approaches important price levels, these levels are critical. The $0.40 level is crucial for supporting further upward movement. The $0.42 level acts as the bottom of the bullish flag. If the price cannot maintain above these levels, it may test another level identified by analysts at $0.35.

On the resistance side, $0.45 is seen as the next breakout level to confirm the bullish trend. If the price breaks above this level, XLM may easily rise to $0.50 and $0.60 in the short term. If the upward momentum continues, analysts have also set higher target prices of $0.80 and $1.

Market sentiment and Stellar's role in blockchain

Due to its excellent performance in the blockchain development sector, Stellar has gained positive market sentiment. The current positive price trend of XLM is related to its involvement in CBDCs and cross-border payment systems.

For example, providing the capability to convert prepaid SIM cards into digital debit cards. These showcase real blockchain solutions.

XLM's 35% weekly increase has attracted significant attention. Following the recent transfer of $36 million worth of XLM to exchanges, short-term price volatility may occur. This activity suggests that long-term holders are taking profits after Stellar has appreciated 300% over the past three months.

The market remains optimistic, believing that if the current upward trend continues, XLM could reach $1 this quarter. This positive outlook encourages maintaining the current momentum, which could push XLM to the $1 milestone within this timeframe.