- Litecoin’s price corrected sharply higher this past week, and is following a nice bullish trend line on the 2-hour chart (data feed from HitBTC).
- As long as the price is above the trend line, there is a possibility of a move towards $4.00-20.
- There is another support trend line formed on the hourly chart (price feed from Bitfinex), which is helping buyers to take the price higher.
Litecoin’s price recovered after trading as low as $3.50, and is currently trading above an important support area that holds the key moving ahead.
Trend Line Support
Litecoin price slowly grinded higher this past week, and we continued to follow a bullish trend line on the 2-hour chart (data feed from HitBTC). The highlighted trend line and support area played well and gave us many buying opportunities; however, we need to be very careful moving ahead, as the momentum is much less and there is no increase in volume. Moreover, it looks like sellers already made many attempts to break the highlighted trend line, which means the chance of a break lower increased over time.
The price is just trading above the 100 simple moving average on the 2-hour chart, suggesting that it is trading around a major support area. A break below the trend line and the 100 MA may ignite a downside move in the near term.
Looking at the hourly chart, there is another bullish trend line forming (data feed from Bitfinex). Moreover, the price is just around the 38.2% Fibonacci retracement level of the last wave from the $3.56 low to $3.79 high. A break below the trend line may be the first sign of a bear leg.
Looking at the Indicators
2H MACD – The 2-hour moving average convergence divergence is neutral, but suggesting a change of trend in the short term.
2H RSI – The 2-hour relative strength index is also below the 50 level, which is another warning for the bulls.
Intraday support level – $3.65
Intraday resistance level – $3.80
Charts from Bitfinex and HitBTC; hosted by Trading View