Hi friends! Welcome to this update analsysis on Litecoin! Let's get right to it.
Looking at the daily LTC chart, you can see that Litecoin has broken out above the 15 EMA (in pink) which has been acting as resistance during the current downtrend. Additionally, the previous candle and the current candle are showing increasing buyer interest. The MACD is expanding to the upside, off of a second bullish divergence (green trendline) in a series of bullish divergences that has been printing for months. The bullish divergences have yet to produce a solid rally, but the fact that they are reoccurring shows that sell-side momentum has been weakening, as the bear market has progressed.
The breakout above the 15 EMA (in pink,) combined with the expanding momentum off of the bullish divergence shows that the current selloff is becoming exhausted, and we are likely entering the stages of a relief rally.
You can see that the lows from around December 25th are producing some horizontal resistance that price is currently running into (red trendline.) If LTC can close a candle above there, and hold it as support, I believe that a test of the 50 EMA (in orange) is imminent. In other words, we could see a rapid rally up to the $35 area, if support is held on the red trendline. A failure at the red trendline would likely send LTC back down to test the recent low, but that is technically now less likely than a rally.
Happy Holidays Everyone!
I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-JD-
Looking at the daily LTC chart, you can see that Litecoin has broken out above the 15 EMA (in pink) which has been acting as resistance during the current downtrend. Additionally, the previous candle and the current candle are showing increasing buyer interest. The MACD is expanding to the upside, off of a second bullish divergence (green trendline) in a series of bullish divergences that has been printing for months. The bullish divergences have yet to produce a solid rally, but the fact that they are reoccurring shows that sell-side momentum has been weakening, as the bear market has progressed.
The breakout above the 15 EMA (in pink,) combined with the expanding momentum off of the bullish divergence shows that the current selloff is becoming exhausted, and we are likely entering the stages of a relief rally.
You can see that the lows from around December 25th are producing some horizontal resistance that price is currently running into (red trendline.) If LTC can close a candle above there, and hold it as support, I believe that a test of the 50 EMA (in orange) is imminent. In other words, we could see a rapid rally up to the $35 area, if support is held on the red trendline. A failure at the red trendline would likely send LTC back down to test the recent low, but that is technically now less likely than a rally.
Happy Holidays Everyone!
I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-JD-
Comment:
Ps. Please excuse my makeshift downtrend channel. I was experimenting with it in my analysis, and I forgot to take it down. However, I do think that it is valid. The bottom trendline only has one touch, but I think that it is likely to produce another reaction, should the market break down to it in the future. That's assuming that we remain inside of the proposed downtrend channel.