Yes, you read that right! The next price target for Litecoin is $2.000; my previous PT (price target) of $3.000 for August has been met and surpassed, and I believe the cryptocurrency will witness severe pain in the coming sessions as well.
As Bitcoin witnessed its Black Monday, it became increasingly clear that Litecoin will face the wrath of the bears. Litecoin is currently trading at $2.530, down a massive 24 percent and the decline may only accelerate going forward.
Take a look at the latest daily LTC-USD technical considerations below.
Litecoin Chart Structure – Litecoin has broken the downward trading range which we had been discussing in the past several analyses. Now at the lowest point of the day, Litecoin has pierced the previous brief consolidation zone and threatens to flirt with the earlier strong resistance zone of $2.000.
Moving Average Convergence Divergence – MACD has dropped to a 7-month low of -0.3032 while the Signal Line has been pushed down to -0.1787. The last observation of Histogram was made at -0.1245.
Momentum – The Momentum indicator portends more losses for Litecoin with its value of -1.3266.
Money Flow Index – The MFI is seen approaching oversold levels with its reading of 21.6586.
Relative Strength Index – The RSI value has slumped to 27.5698.
We have been discussing for long that weakness in Bitcoin will have a compounded negative effect on Litecoin. And that is what we are witnessing now. I am sensing another 15-20 percent decline in Bitcoin, and by that measure, the target of $2.000 on Litecoin isn’t very unrealistic.
Short Litecoin on rallies by maintaining a stop-loss above $3.200. Yes, there will be a good rebound as the cryptocurrency is in or near the oversold territory.
Another point that market participants should keep in mind is that the level of $2.000 is an important one, and light long positions can also be created around that. It is hard to see an immediate violation of this support level.