I see almost everyone going short on Litecoin. I've decided to become the contrarian voice crying in the wilderness yet again. I've just picked up a boat load of Litecoin at $50 even. I expect Litecoin to continue to trend up this month (more analysis on that at a later date). My guess right now is that Litecoin will hit $60-75 by the end of the month. But for now this is just a projection based upon the angle of my upward trending channel I've drawn.
Now let me make the case for my contrarian view based upon simple analysis:
1) Bitcoin (see my BTCUSD charts) cannot conquer the $2600 level. It has tried many times and failed. This indicates weakness in the Bitcoin market along with several other factors. 2) Bitcoin's weakness is Litecoin's strength, as crypto purist will probably NOT switch over to establishment backed coins such as Ethereum or Ripple. So, due to the BIP 148 fork due Aug 1 for Bitcoin, I see a continued outflow of capital fromf Bitcoin into Litecoin until this target date. 3) Litecoin has solid support at $50. Not only is this support from the 6-19 high but is also .236 Fib retracement.
Of course, I very well could have jumped the gun a bit here with my purchase and Litecoin could still drop down to the next major support that I see at around $45. But either way, I see continuation to the upside before that Aug. 1 date. And since I am a swing trader holding trades for weeks and months, I see this as a very profitable investment.
You could play it a bit differently than I did and purchase 50% of your Litecoin stake here and dollar cost average down to the $45 mark if you want to bet we'll go there (and we could). But, the risk is, you could get left empty handed should we suddenly jolt upwards from here. Your call.
Me personally, I am waiting to see if a higher low can form before entry with a reset of Stochs. If a formation of a higher short term low can not develop, then I would look to buy an opportunity near the lower trend line IF that were to happen.
dysangel
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lol
dysangel
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(I do agree that it probably will go up by the end of the month due to the MIT release, but I went short last night and I'm glad I did!)
stewdamus
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@dysangel, Yes. I am glad you did as well. Hopefully, for your sake, I am wrong about the $45 support as well. Although, I'd put in your stops to be safe.
mcnab_54
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Thoughts on the ATH H&S we saw two days ago actually being the 1st and 2nd wave of a larger Elliot Wave?
stewdamus
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@mcnab_54, Better to ask the Elliot Wave experts out there of which I am not one (though I hope to learn more).
mcnab_54
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@phil.steuerwald, no worries, thanks for your response. Trying to learned trends and identify what I can. Doesn't look like we got the bounce you were hoping for but I think in the next few weeks it will hit another ATH so it's still good to be in right now.