Litecoin has broken out from the two-week trading range we discussed in the previous Litecoin price technical analysis titled Range Trading? as positivity from the Bitcoin market spills over. Litecoin is currently trading at $2.887.
Though a breakout may seem as the best indication for the market participants to go long on Litecoin, my advice would be to wait for a close above $2.950 or buy on a dip. But, why do I say this? Read on the technical indications below to find out.
I still find the technical indications fairly mixed and therefore, require stronger signals or a low-risk opportunity to enter into Litecoin trading.
Litecoin Chart Structure – As can be seen from the daily LTC-USD price chart above, Litecoin has breached the resistance after spending considerable time within the contracting range. A breakout after a long time is generally followed by big price moves.
Moving Average Convergence Divergence – The value of Histogram has increased very minutely to 0.0300 while that of MACD has appreciated to -0.0735.
Momentum – The Momentum reading is now positive at 0.1020.
Money Flow Index – The 14-day MFI reading is 52.7522.
Relative Strength Index – To much surprise, even after the breakout, the RSI remains relatively flat-lined. The value of 46.8716 fails to induce confidence in the buyers.
While MACD continues to show an advance in value, other indicators remain choppy and their latest values fail to boost the confidence level. The chart structure remains shaky below $2.950.
Those who are willing to take higher risks can go long in Litecoin now and on dips by maintaining a stop-loss below $2.800.
The breakout in Litecoin was supported by a jump in Bitcoin price. The upside target of Bitcoin is $245, which is roughly 4 percent higher than the current value. Expect a similar jump in Litecoin if Bitcoin meets its target.