The massive rally in Litecoin has absolutely crushed the bears and made the bulls tremendously richer in a very small period. Litecoin surged roughly 30% since my last analysis to hit a fresh 2-month high of $1.989. As the virtual currency threatened to take out a strong resistance zone, sellers made their comeback and pulled the price considerably down.
Litecoin is currently trading at $1.840, off 7.5% from the peak value.
Image: https://www.tradingview.com/x/YqgHIDOD/
The 240-minute LTC/USD price chart clearly tells us that the virtual currency is currently in a “no-trading” zone.
Litecoin Chart Structure – In my previous analysis, I mentioned that Litecoin will easily climb above $1.600 on strong momentum. Litecoin, in fact, crossed this major hurdle on huge volumes (marked in the chart above) which paved the way for astronomical gains for the bulls. The virtual currency ran out of fuel near the strong supply zone of $2.000.
Moving Average Convergence Divergence – The Histogram value drops into the negative region as MACD crosses Signal Line on the downside. The MACD currently reads a value of 0.0775 while the Signal Line maintains positive status with a value of 0.0896.
Momentum – As the price leapfrogged to a 2-month high, the Momentum reading surged to a 3-month high of 0.4200. However, falling price had a compounding effect on the Momentum reading which crashed to the ground. The 10-4h Momentum reading is 0.0083.
Relative Strength Index – As the RSI indicator touched stratospheric levels of 93, fears of overbought valuations brought down the price. The virtual currency is still overbought, considering the 70.0914 reading of the RSI indicator.
Conclusion
It is very risky to say which way Litecoin will head next to: whether further profit will rock the market or if the bulls will take the value above $2. But, one thing that can be said with utmost certainty is that traders should wait for more attractive levels to initiate any trade.