- Litecoin price continued to move down this past week and traded as low as $3.00.
- The price is currently trading higher, but facing a monster resistance near a bearish trend line formed on the 4-hours (data feed via Bitfinex).
- As long as the price is below the $3.25-3.30 levels, there is a chance of a downside move in the short term.
Litecoin price recovered well after a major drop. However, the bulls have a job on their hand, as LTC/USD faces a major resistance areal.
Litecoin Price – Buy with a Break?
Litecoin price managed to trade higher against the US dollar and was mostly seen consolidating below a major resistance area of $3.25-30. There is a confluence area forming around the stated levels, as there is a bearish trend line on the 4-hours (data feed via Bitfinex) positioned. Moreover, the 61.8% Fib retracement level of the last drop from the $3.40 high to $3.00 low is also aligned near it to increase the importance of the resistance area.
The most important aspect is that the 100 simple moving average on the 4-hours chart is also around the same highlighted resistance confluence area. That is the reason why, there is a monster hurdle for the bulls near $3.25-30.
If the buyers succeed in breaking the highlighted resistance area, then a move towards the 88.6% Fib retracement level of the last drop from the $3.40 high to $3.00 low is possible. One may consider buying if the price settles above the 100 SMA (H4 chart) with a stop if the price moves back below it.
Looking at the indicators:
4-hours MACD – The MACD is almost flat, calling for a consolidation and then a break.
4-hours RSI – The RSI is above the 50 level, which can be considered as a positive sign for the bulls.
Intraday Support Level– $3.18
Intraday Resistance Level – $3.25
Charts from Bitfinex; hosted by Trading View