Altcoins

Litecoin [LTC] traders must consider this before entering a position

Disclaimer: The findings of the next evaluation are the only real opinions of the author and shouldn’t be thought-about funding recommendation.

The current market-wide drawdowns helped Litecoin [LTC] sellers to drag the alt towards its 19-month help within the $61-zone. Thus, it shortly plunged beneath its trendline resistance whereas witnessing a bearish pennant breakdown on the day by day chart.

A possible shut beneath the fast help may heighten the possibilities of a $57-$59 vary retest. At press time, LTC traded at $61.95.

LTC Daily Chart

LTCUSD 2022 06 08 18 53 49

Source: TradingView, LTC/USD

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The altcoin’s aggravated bearish drop from the $98-mark has pulled LTC beneath its 11-week trendline resistance (white, dashed). With the Point of Control (POC, pink) providing the very best stage of liquidity, the alt has been extending its compression section.

The 38.2% and the 23.6% Fibonacci stage have curbed shopping for rallies throughout LTC’s revival from its 18-month low on 12 May. 

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With the 20 EMA (pink) nonetheless wanting south, the shopping for comebacks nonetheless wanted to document greater buying and selling volumes. Furthermore, the quick symmetrical triangle’s breakdown may provoke a short-term draw back. The purchaser’s potential to carry the fast grounds may see an prolonged squeeze section close to its POC within the coming periods.

Any shut beneath the $64.1-mark could lead on LTC to check the $57-mark earlier than the bulls goal to retest the trendline resistance. The bulls wanted to shut above the 20 EMA to affirm any restoration possibilities within the days to return.

Rationale

Capture 17 scaled

Source: TradingView, LTC/USD

The Relative Strength Index (RSI) has been rebounding from the 40-mark resistance for the final month. Thus, depicting a bearish edge within the close to time period.

While the Aroon up (yellow) hovered close to the 0%-30% vary, the sellers claimed an edge within the present market construction.

However, the bullish divergence on the OBV may assist the consumers maintain on to the $64-zone and proceed the tight section.

Conclusion

Placing lengthy bets towards the development is probably not worthwhile but, particularly with the weak readings on the indictors.

A detailed past the $64-zone would open up near-term retracement prospects towards the $57-$59 vary. The alt would doubtless enter a squeeze section till the consumers constantly ramp up the shopping for volumes.

At final, LTC shares a 36% 30-day correlation with the king coin. A detailed eye on Bitcoin’s motion can be crucial to make a worthwhile transfer.

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