Litecoin falls 2.19 percent to $3.030 as market participants booked profits in their long positions. The cryptocurrency fell from a high of $3.120 to a low of $2.994 before recouping losses partially.
Litecoin Chart Structure – As Litecoin falls towards its strong support (marked in the daily LTC-USD price chart above), buyers are rushing in to buy the cryptocurrency. That is good trading sense given that the trendline has been retested 4 times before and has resulted in a stronger rebound.
But, this time, things may work out differently. Why? Read on below what the technical indicators are saying.
Moving Average Convergence Divergence – The MACD and the Histogram are still in the positive territory while the Signal Line continues to suffer losses. The latest values of MACD, Signal Line and Histogram are 0.0195, -0.0019 and 0.0214 respectively.
Momentum – A dangerous sign for the Litecoin bulls could be the crucial breakdown in Momentum value. As can be seen, the Momentum reading has succumbed below a crucial support level, signaling a dent in the bulls’ confidence. The Momentum reading has been reduced to 0.0015.
Money Flow Index – Another ominous breakdown has occurred in the MFI value. The indicator has pierced a major support point which may spell trouble for Litecoin. The latest MFI value is 53.882.
Relative Strength Index – The 14-day RSI is fairly neutral with a value of 54.3949.
While Litecoin is holding up well inside the trading range marked in the price chart, things may actually be worsening. The above considerations should be carefully watched by the bulls who are simply following the price action without heeding the underlying technicals.
The last hope for Litecoin is Bitcoin. If Bitcoin falls to profit booking or fresh selling pressure and breaches $240, expect the Litecoin support to cave under as well. Therefore, remain very cautious while creating fresh trades.