If there was a competition right now between our beloved hero Superman and the cryptocurrency Litecoin, I think even our iconic hero would say for once “Okay, let’s catch a break!”
Litecoin is breaking all the fathomable boundaries, having jumped from $2 to more than $8 in just the past 4 weeks. And with momentum and trend remaining overtly bullish, there is no saying what valuations we will see going ahead.
Litecoin has jumped a massive, a phenomenal 31% in the past 24 hours to leapfrog to $8.100.
Image: https://www.tradingview.com/x/GkgJECbh/
In today’s analysis, we are taking a departure from the normal routine in a way that a weekly price chart will be considered. While I was thinking that Litecoin is extremely overvalued from a short-term perspective, the weekly chart suggests that Litecoin is nowhere close to being a safe bet even from a medium-term point of view as well.
Litecoin Chart Structure – With massive gains in the past 4 weeks, Litecoin has virtually erased all the losses of the past 52-weeks and looks all set to hit a new yearly high.
Moving Average Convergence Divergence – On a weekly basis, MACD maintains its lead over the Signal Line. MACD has now risen to 0.3962 while Signal Line has gained to -0.4331. The Histogram is positive with a value of 0.8294.
Momentum – The Momentum indicator has surged to a yearly high of 6.6639.
Money Flow Index – It is not every day or even every week that you see the MFI value above 90, which is considered outrageously overbought. However, Litecoin continues to comfortably trade at an MFI value of 94.4246.
Relative Strength Index – The weekly RSI indicator is also indicating highly overbought conditions with a value of 83.3185.
Conclusion
The rally in Litecoin is one of a kind. The weekly technical indicators are in the highly overbought territory, but the momentum and trend are simply too strong. Only high-risk traders should enter Litecoin now, but do so only if you have to!
