Litecoin (LTC) Technical Analysis: Bullish Falling Wedge Looking to Breakout Soon
Nothing in this article is to be construed as investment advice. Neither the author nor the publication assumes any responsibility or liability for any investments, profits or losses you may incur as a result of this information.
Litecoin is looking promising going into this week despite the #4 cryptocurrency currently being stuck in a strong downtrend after peaking at 0.0177BTC on June 12.
At the time of writing, LTC is down 3.01% against the US dollar and trailing behind Bitcoin by a further 3.27%. Trading volume has also shown a marked decrease over the last week, as Bitcoin’s surge above $9K pulled investors away from the altcoin market. But it’s not all doom and gloom, as the asset continues to track inside a bullish falling wedge pattern.
Litecoin (LTC) Price Analysis
On the 4-hour LTC/BTC chart we can see that the current downtrend is being pinched into a point between two trendlines. This is a classic sign of a falling wedge pattern, and shows that bear traders are slowly exhausting themselves while bull traders are waiting for a strong support to relaunch from.
Looking at the fibonacci retracement levels, we can see a strong support at the 0.618 ‘golden ratio’ level at around 0.10356BTC, which was also a key resistance throughout May. This lower level (bottom red line) sits well at the maximum consolidation point of the falling wedge, and is very likely to provide a pushback opportunity for bullish traders if LTC continues downtrending in the short-term.
We can already see that momentum on the MACD indicator is beginning to show early signs of reversing as selling volume decreases on the histogram, and the 12MA looks to converge above the 26MA. LTC price is also very close to the oversold region on the RSI, which will be placing additional buying pressure on the current downtrend.
The first support at 0.0141BTC (upper red line) could potentially provide an early breakout from the pattern if buying volume picks up over the next 48 hrs. We will need to wait until the sloping resistance is confidently cleared first however, before assuming that Litecoin has exited early.
Litecoin (LTC) Price Targets
All ROIs are calculated from the asset’s current value at 0.0142BTC (AToW).
PT1: 0.5 fibonacci level/ 0.0143BTC (0.00%)
PT2: 0.0153BTC (8.19%)