Litecoin is facing pressure just like Bitcoin and has been unable to cross the major resistance level of $2.08. However, as mentioned in yesterday’s analysis, it has again respected the 20-day simple moving average of $2.019, boosting investors’ morale.
The “Long” recommendation is based on the technical analysis done on the 240-minute LTC/Dollar price chart. Here are some noteworthy observations:
Price Structure – As can be seen from the chart, the price is floating well above the support level of $1.98 and has recently reaffirmed the 20-day SMA of $2.019 as a support. Sustaining above this crucial technical level will give bulls a better chance of winning.
MACD – The Moving Average Convergence Divergence value of 0.0083 is closely followed by the Signal Line reading of 0.0080. This leaves the Histogram value barely positive at 0.0003. Bulls can take respite from the fact that all the readings are positive and that more gains can be built on this.
Relative Strength Index – Even after correction, the RSI value remains in favor of the long traders. The reading of 54.54 indicates that the undercurrent is still positive and long positions may be considered.
Momentum – The Momentum indicator reading is another technical factor favoring the buy recommendation. The positive Momentum reading of 0.0084 mirrors the optimism shared by the above indicators.
With the above technical viewpoints, it is expected that the Litecoin bulls will make more attempts to claim new highs and jump over the resistance level of $2.08. The target on the upside remains at $2.17 while the stop-loss should be placed just below the horizontal support line (on a closing basis). Market participants should also keep an eye on movements in US dollars as it directly affects the cryptocurrencies. The Fed meeting scheduled for today also holds great importance from a trading perspective.