Litecoin has been consolidating since finding support at 1.32 This consolidation follows a 3-point divergence between price and the RSI. Then, after a failed bearish attempt to test 1.32, price rallied again and rallied up to 1.46 before finding resistance.
In the 1H chart, we can see that there was resistance around 1.45-1.46, which was a common support from a previous consolidation. As price falls, we should watch what happens around 1.37. If ltcusd breaks below 1.37, it would break below the 100-, and 50-hour simple moving averages (SMAs) and this week’s rising flag pattern support as well. That would signal bearish continuation with 1.32 in play and with risk of continuing a downtrend towards the parity (1.00) level.
Now, if price holds above 1.37, and the 1H RSI holds above 40, there is still more consolidation to go through, and price should be pressured towards the 1.46 high, with the 1.49-1.50 area as the next key resistance.
Now, in the 4H chart, we can see that the trend is still bearish as price holds under the 200-, 100-, and 50-period SMAs and the RSI holds below 60. But let’s say price breaks above 1.50, and the 4H RSI pops up above 60, we would see a market that has lost the bearish bias and momentum. In this scenario, we should look for a rally attempt to the 1.60 area, a previous support pivot.
If price holds under 1.50, and the 4H RSI holds under 60, the bearish trend is still in play, and pressure would be on the 1.32 low of the week. This is the preferred scenario, and as we mentioned above, there would be risk of further “chewing” of the tail made on April 9th, down to the parity (1.00) level.
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