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Litecoin (LTC) Technical Analysis

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Generally, Litecoin is a long term buy and after several fundamental announcements, odds are prices are likely to take off according to our Litecoin price projection. Though price action points a different picture with prices declining three percent in the last 24 hours, today and tomorrow would be important.

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Recent Litecoin Foundation and Charlie Lee’s drive for merchant and retail adoption is surely paying off. At the moment, given how things are turning out, we can confidently say that their #PayWithLitecoin Social media campaign has been a success. We have seen several high ranking merchants and payment providers increasing their payment options by listing Litecoin. This is wonderful from a holders’ perspective and why not? Many analysts have come towards the support of this medium of exchange coin saying that it’s even poised for further gains.

In my view and I reiterate, there is but a gross undervaluation of Litecoin. Technical arrangement from price action and certain fundamental aspects of the coin complements this view. Of course the user case is there and from a development point, supporters got something to cheer about following their latest Litecoin core update.

In the face of 51 percent attacks, Charlie Lee who is the coin’s ambassador has come out to defend the coin. Of course after LitePay debacle and the consequent breach of trust, we need further assurance. Luckily for us, we have solid metrics that he showed supporters on what it could take to pull out such a move and yes, it looks like the network is safe.

Besides, to wash out the LitePay stain, it is rumored that the Litecoin Foundation is creating a better and even faster version of LitePay as they look to boost their #PayWithLitecoin campaign-which now has a website. If that is indeed true then we might see Litecoin prices correcting to the upside as they correct this “undervaluation”.

Litecoin (LTC) Technical Analysis

Weekly Chart

In line with our previous analysis, we now have a clear triple bottom after last week’s bullish bar. $120 is apparently turning out to be a strong spring board for buyers and that’s the reason why the nature of this week’s close will either make or break Litecoin. In any case, it’s highly like that buyers may pick up and reverse May’s long covering as market participants jump in and pump prices. We are already seeing that from price action because every time there are gains in lower time frames, the lower wick of this week’s candlestick keep getting longer.

The longer it is, the more the buy pressure and the more valid our long calls are. However, rather than diving in without due diligence, I recommend buys—for risk on traders-once bulls push prices above $140 or week ending May 27 highs. Otherwise for risk off and hawkish traders, buying on dips or at current prices with stops at $115 or last week’s lows can be a good trading strategy.

Daily Chart

At this time frame, it’s clear that buyers have an upper hand over price action. All we need is a follow through of last week’s event and aligning with the hawkish trend that was set in place in April.

As such, buying on dips is but a good move now that Litecoin prices found support at our first level of support at $115. Because yesterday was bearish negating the double bar reversal pattern after June 4-5, today risk off traders can decide to keep off trading and wait to see what happens at $115. If not, then waiting and ramping up longs at $140 as set in the weekly chart is safer.

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