Pursuant to my earlier analysis titled Roadblocks Ahead, Litecoin continues to face pressure near the marked resistance level. After collapsing to a six-week low of $1.60, the cryptocurrency has managed to recover some lost ground, and is currently trading at $1.80.
Image: https://www.tradingview.com/x/sT6dtZGX/
With this, Litecoin has managed to just edge above the Resistance Line 1, which represents a value of $1.79. The technical indicators overlaid on the 240-minute LTC/USD price chart signify that some more gains can follow the rebound.
- Momentum – It was earlier mentioned that the Momentum indicator was maintaining a downward bias, however, in the past couple of days, the bulls seem to have found the lost momentum as the value crosses the resistance level (marked in the image) and sustains in the positive territory at 0.0395.
- Relative Strength Index – Another reason that strengthens my view of short term gain is the bullish crossover of the RSI value. When the selloff intensified in Litecoin, the RSI value also dropped below the key support level of 43, but with cryptocurrency paring the losses, the value has crossed the technical barrier and put the game in balance. With price trading close to the Resistance Line 1 and current RSI value at 50.2170, the bulls may draw confidence and attempt to push the price higher.
- Moving Average Convergence Divergence – The MACD indicator and the Signal Line are strongly approaching the positive region (they are still in the negative zone). The Histogram continues to sustain an upbeat bias with a reading of 0.0154.
Market participants must note that any ensuing rise must be used to exit the long positions and initiate fresh shorts. Fresh buying can be done at oversold levels or after the cryptocurrency has unfailingly managed to sustain above the mentioned resistance levels. The level of $1.88 may be a good exit point for those looking to book profits.
