Not much happened today in the price action of litecoin. As we can see in the 1H chart, price has been drifting sideways since the cryptocurrency rallied from around 1.60 to about 1.82. While price is indeed still in this consolidation range, we can see a bearish bias.
1) The 200-, 100-, and 50-hour simple moving averages (SMAs) are in bearish alignment and are sloping down.
2) Price is starting to hold below the cluster of these SMAs, which shows bearish bias.
3) The RSI has held below 60, and has tagged 30, showing development of bearish momentum.
Now, if price climbs back above 1.70, it would invalidate the noted bearish signs, especially if the 1H RSI also climbs back above 60. In this scenario, litecoin would likely continue its consolidation, with some near-term upside risk back towards the 1.80-1.82 area.
However, if price falls below 1.60, ltcusd would open up the bearish continuation scenario.
Looking at the daily chart, we do see a likelihood of the bearish scenario. Price is already holding under the cluster of 200-, 100-, and 50-day SMAs. The RSI has tagged below 30, and has so far held below 60, which shows maintenance of the bearish momentum.
So, if litecoin price falls below 1.60, it would open up the 1.10 low on the year with risk of extending to the 1.00 parity level. We noted that a break above 1.70 might put pressure back on 1.80-1.82. However, it would probably take a break above 1.82 to open up a short-term bullish outlook, within the context of a medium-term consolidation. In this scenario, there would be upside risk towards that high at the end of January around 2.44. Above that, the 2.75 high on the year would be in sight again. With that being said, we should still favor the bearish outlook since the trend throughout 2014 and into 2015 has been bearish.
Previous Post by Author on Litecoin: Litecoin Price Technical Analysis for 31/3/2015 – Bearish Control