Disclaimer: The findings of the next evaluation are the only real opinions of the author and shouldn’t be taken as funding recommendation
Unable to discover a clear route regardless of Bitcoin’s ascent, Litecoin remained gridlocked inside a descending triangle setup. Whereas the sample usually observes a breakdown, LTC’s end result will not be but clear.
The altcoin was buying and selling above its near-term SMAs and its indicators took a impartial strategy. With the intention to pinpoint LTC’s trajectory, the worth wants to shut above or beneath sure key areas on the chart.
On the time of writing, Litecoin was buying and selling at $195, up by 0.6% over the past 24 hours.
Litecoin 4-hour Chart
Supply: LTC/USD. TradingView
Three successive decrease highs at $215, $200, and $197 highlighted a downtrend for LTC after a 16% run-up was noticed final week. When mixed with the 2 lows shaped on the 50% Fibonacci Retracement stage, a descending triangle setup appeared on the 4-hour timeframe.
Ought to LTC minimize beneath the confluence of its 20 (purple) and 50 (yellow) Easy Transferring Common traces, one other assault on the baseline could be anticipated. From there, a near-term pullback of 6.5%-8% may come to mild in case LTC weakens beneath the $188-mark.
In the meantime, a detailed above the higher sloping trendlines and 61.8% Fibonacci stage would arrange an upwards breakout from the sample. The following Fibonacci zone at $217 could be challenged instantly, supplied the broader market stays danger on.
Reasoning
Now, the 4-hour RSI gave the impression to be traversing inside a down-channel and a more recent low may type on the decrease trendline, beneath the 50-mark. Based mostly on this end result, there’s a likelihood that LTC would break south from its triangle. The RSI would wish to maneuver above its higher trendline to invalidate this outlook.
Alternatively, the Superior Oscillator introduced a impartial bias after buying and selling near its half-line. Despite the fact that the MACD pictured related actions, greater peaks alongside the histogram had been encouraging for bullish merchants.
Conclusion
There gave the impression to be legitimate arguments to help a breakout in both route from a descending triangle. To play it secure, merchants ought to anticipate LTC to shut above or beneath key ranges earlier than taking over positions available in the market.
Bullish merchants can lengthy as soon as LTC closes above the 61.8% Fibonacci stage whereas short-sellers can enter the market as soon as LTC closes beneath the 50% Fibonacci stage.
