Price retraced to $60 which cancels out the possibility that we are in a new impulse (wave 2 must not retrace past the start of wave 1). We may now be nearing the completion of ABC retracement making up wave 2 after bouncing off of that support at $60. However after taking a look at LTCBTC chart (important to refer back to BTC for LTC and ETH as much of the trading seems to be in BTC, thanks for this tip @marcpmarkets) I see a massive head and shoulders that makes me think that LTCUSD may retrace back to next support at $55 which also corresponds to Fib .236 of wave 1, or potentially lower. Alternately LCTBTC could still rise to the level of left shoulder which is significant (+30%) given the size of the mega formation there.
At the macro level many coins are now following BTC in very similar moves, all simultaneously retesting supports from 9/4 and the news this week has been very negative with China financial regulators and Jamie Dimon both releasing statements that led to big sell-offs so I am skeptical that the corrective wave is over. The market will tell us soon though.
So how to trade this market? We need some confirmation that we are in a new impulsive wave before we can say that the corrective wave is over. If this second bounce off of $60 holds then we will need to see a higher high above the $71 area to confirm reversal. Overall bullish but not from this level.
At the macro level many coins are now following BTC in very similar moves, all simultaneously retesting supports from 9/4 and the news this week has been very negative with China financial regulators and Jamie Dimon both releasing statements that led to big sell-offs so I am skeptical that the corrective wave is over. The market will tell us soon though.
So how to trade this market? We need some confirmation that we are in a new impulsive wave before we can say that the corrective wave is over. If this second bounce off of $60 holds then we will need to see a higher high above the $71 area to confirm reversal. Overall bullish but not from this level.