Litecoin [LTC] Price Analysis: Is The Recent Bearish Candle A Sign Of Things To Come?

Published February 6, 2019 | Updated February 6, 2019

Litecoin price analysis
Litecoin price analysis

Litecoin [LTC] Price Analysis: Is The Recent Bearish Candle A Sign Of Things To Come?

Key Highlights:

  • The price of Litecoin failed to retrace past the 0.5 fib line of the drop from $41 to $30.
  • Price just made a bearish engulfing 2-hour candle.
  • Price is following a short-term ascending support line.
  • The daily MACD is close to making a bearish cross

Litecoin [LTC] Price Analysis – Daily Chart LTC/USD

The price of the LTC/USD pair is struggling to break through the resistance offered by the 50-day moving average, similar to the failed attempt on January 8th to break past $41. The start of the day has given us an extremely bearish outlook, with a drop of 5% (from $35.5 to $33) occurring in less than 10 hours. (All data are taken from the LTC/USD pair on Bitfinex)

Litecoin price Analysis
Chart Source: Tradingview, Bitfinex

A look at the Daily chart shows that price made a second unsuccessful attempt to break through the 50-period MA (blue line) and got rejected. Price retraced and has currently found support at the 7-period MA, which has recently made a bearish cross. It is of importance to keep an eye on the daily closing price since the first 9 hours of the day were extremely bearish. While the LTC/USD price opened at $35, it is currently trading at $33.2, a drop of 5%. Furthermore, the MACD is losing its power and setting itself up to make a bearish cross. It is of importance to keep an eye on the MACD since the bearish cross could occur during the next 2-3 days.

Litecoin Price Analysis
Source: 2 hrs Chart Tradingview, Bitfinex
advertisement

A closer look at the 2-hour chart shows us that after launching an upward rally on January 28th, price failed to retrace past the 0.5 fib line of the drop from the $42 high to the $30 low. After two unsuccessful attempts to break past the 0.328 fib line at $34.3, the price was successful on the third attempt, but immediately got pushed back once it reached $35.5.

Price formed a bearish engulfing 2-hour candle (yellow arrow) on very significant volume and has retraced back all the way to the 200-period MA, forming an ascending support line in the process. A break below the 200-period MA and the support line would put the recent support area at $30.5 into play. Furthermore, the 7 and 21 period MAs are very close to making a bearish cross, placing the price firmly into bearish territory.

Conclusions

  • The closest support area is near $29, with major support near $23.
  • The major resistance area is near the January 8th top at $41.
Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author

Subscribe to our newsletter for free

Valdrin Tahiri 33 Articles
Valdrin is an eager trader, cryptocurrency enthusiast, and freelance writer. He specializes in technical analysis, indicators and charting guides. Reach out to him at [email protected]

Loading Next Story