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Stellar is trending lower inside a descending channel on its 4-hour time frame and has just bounced off the top. Another move to the bottom might be underway and the Fib extension tool shows the next potential downside targets.

Price is nearing the 38.2% extension at .1282 but might have enough selling power to make it to the 50% extension at the mid-channel area of interest. Stronger selling pressure could take it down to the 61.8% extension at the .1000 major psychological mark or the 78.6% extension at the channel support.

The 100 SMA is below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. In other words, the selloff is more likely to resume than to reverse. The 100 SMA lines up with the channel top as well to add to its strength as a ceiling. Also, the gap between the moving averages is widening to reflect increased selling momentum.

RSI is heading lower but is already dipping into the oversold region. This suggests that sellers are starting to feel exhausted and may let buyers take over. If so, a break past the channel top could be followed by a test of the swing high resistance or a move to the 200 SMA dynamic inflection point.

Stochastic is also indicating oversold conditions and looks ready to turn higher. Moving north could confirm that buyers are returning so Stellar price might follow suit.

Stellar could see some upside, though, or at least a bit more support as BitGo launched support for the cryptocurrency. This makes it the first multi-signature wallet and custodial solution on the market supporting the digital currency.

Ben Chan, BitGo Chief Technology Officer said:

“We’re continuously adding support for digital currencies that our clients express interest in, and lumens are a natural next addition. The Stellar network offers BitGo clients access to a public financial structure for cross-border transfers, making XLM an important new asset for investors.”