Despite Bullish Factors, Litecoin Suffers Brutal Rejection At Downtrend Resistance

Tony "The Bull" Severino

1 year ago

4 mins read

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Litecoin was one of this week’s biggest movers and shakers in crypto, beating even Bitcoin substantially. The bullish impulse took the altcoin to a year-long downtrend line against BTC but unfortunately was rejected hard.

With the general consensus being that Litecoin often leads the way for altcoin trends, a further fall against Bitcoin – as analysts have been predicting – could be coming.

Litecoin Lights Up Green As The Cheapest Crypto Coin On PayPal

Litecoin was left behind this summer’s altcoin season, while Ethereum and DeFi soaked up all of the capital. When that trend ended, the tides turned to Bitcoin. But now, it could finally be Litecoin’s turn.

Although the altcoin referred to as digital silver has had a lackluster 2020, it could end up being the cryptocurrency that most benefits from the biggest news of the year.

No news has even come close to PayPal supporting cryptocurrencies and offering them to the company’s 350 million users. It was the “shot heard ’round the world on Wall Street,” according to crypto bull Mike Novogratz.

It was also the catalyst that potentially triggered a new bull market for Bitcoin. Only four cryptocurrencies are offered by PayPal currently: Bitcoin, Bitcoin Cash, Ethereum, and Litecoin.

 Litecoin was rejected at the downtrend line against BTC | Source: LTCUSD on TradingView.com

Litecoin, being the cheapest of the bunch and still sporting a scarce supply, has responded with an explosive more than 25% move this week alone.

The daily chart above shows a clear breakout of Litecoin’s downtrend line against the dollar. However, against Bitcoin, things aren’t faring as well.

 Litecoin was rejected at the downtrend line against BTC | Source: LTCBTC on TradingView.com

Are Altcoins Ready To Collapse Further Against Bitcoin?

In the chart above, Litecoin was rejected for a fourth time from a downtrend line stemming from the 2019 altcoin peak. During the time, Litecoin had kick started the year off with a bang due to its block reward halving. The asset reached a 500% return before a massive crash. Bitcoin made a run for $13,800 leaving alts behind, beginning the downtrend on the LTCBTC pair.

An “altpocalypse” ensued, setting even deeper lows on each coin’s BTC ratio.

Litecoin’s weakness on the BTC pair could suggest that there is still one more large fall left for altcoins against Bitcoin.

While Bitcoin makes a run to its former all-time high, altcoins could fall victim to BTC bullishness once again like they did last year.

The path to the next altcoin season arrives after Bitcoin sets a new record | Source: CRYPTOCAP-BTC.D on TradingView.com

BTC dominance is also breaking up out of a broadening wedge pattern. The target is similar to the previous structure’s measured move, which would take the metric back to 83%, absolutely obliterating altcoins in the process.

Alts could continue to get dragged up in USD value due to Bitcoin’s bull run, each altcoin’s ratio could have one more drop to sweep current lows.

The one saving grace for Litecoin could be the fact that the recent altcoin season skipped over it entirely. “Paleo-alts” is a term recently coined referring to a class of older altcoins that have been since forgotten about for shiny new DeFi tokens. XRP is another, for example.

 Litecoin was rejected at the downtrend line against BTC | Source: LTCBTC on TradingView.com

The two laggards along with other archaic by crypto standards alts could still do well while Bitcoin crushed the rest of the space.

When LTC does breakout against the leading cryptocurrency, it rises adnywhere from 150 to 450% on the ratio.

With Bitcoin getting more expensive by the day and out of the reach of retail investors, and Litecoin acting as the most cost-effective way to own full coins on PayPal. the downtrend line that is currently holding LTC back might not do so much longer.

Featured image from Deposit Photos, Charts from TradingView.com

Tony "The Bull" Severino

Tony "The Bull" Severino, CMT, is a distinguished figure in the cryptocurrency analysis sector, renowned for his in-depth technical expertise and innovative approach to market trends. As the Head of Research at NewsBTC, Tony leads a team dedicated to providing cutting-edge insights and forecasts, helping both novice and experienced traders navigate the complexities of the crypto market.
A seasoned Chartered Market Technician, Tony's prowess in identifying and capitalizing on market patterns is unmatched. His academic and professional journey in market analysis has firmly established him as a leading authority in technical trading strategies. Tony’s approach is heavily influenced by the principles of Elliott Wave Theory, a method known for its rigorous assessment of investor psychology and price movements.

Beyond his role at NewsBTC, Tony is the visionary founder of CoinChartist.io, an educational platform aimed at demystifying the nuances of cryptocurrency trading. CoinChartist.io serves as a valuable resource for traders seeking to enhance their technical analysis skills. The platform offers a range of learning tools and resources designed to empower traders with the knowledge to make informed trading decisions.

In addition to his educational initiatives, Tony is a prolific author and a dominant voice in the crypto community. He writes the CoinChartist VIP newsletter, a weekly dispatch that has become a staple among crypto enthusiasts, revered for its insightful analysis and actionable trading advice. This newsletter has consistently ranked as a best-seller on SubStack, boasting thousands of subscribers who rely on Tony’s expertise to guide their trading strategies.

Tony is also celebrated for his literary contributions to the field. He is the author of the highest-rated Crypto Trading Journal on Amazon.com, a testament to his ability to communicate complex trading concepts in an accessible manner. This journal is widely regarded as an essential tool for traders aiming to track their progress and refine their strategies.

Before his ascent in the financial analysis world, Tony honed his skills in journalism. His background in this field has endowed him with a unique ability to present intricate market dynamics in a clear and compelling manner, making his insights highly sought after by a broad audience that ranges from casual readers to professional traders.
His professional affiliations underscore his commitment to excellence and continuous learning. As a partner of Elliott Wave International and TradingView, Tony collaborates with other leading experts to enhance his knowledge and skills. His active membership in the CMT Association further aligns him with the highest standards of industry practices and ethics.

Tony’s nickname, "The Bull," aptly reflects his aggressive and optimistic outlook on the cryptocurrency markets. His forecasts often anticipate significant upturns, earning him a reputation for bullish predictions that have frequently led to lucrative outcomes for those who follow his advice.

In summary, Tony "The Bull" Severino, CMT, is more than just a technical analyst; he is a mentor, educator, and innovator whose influence in the cryptocurrency space continues to grow. His dedication to advancing the understanding of market forces and his commitment to providing high-quality, reliable analysis make him a pivotal figure in the world of cryptocurrency trading.

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