LTC/USDT: Daily Breakout Analysis 1D (Aug. 01)

X Force Global Analysis:


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In this analysis, we explore Litecoin's daily chart in order to assess its breakout pattern and potential targets by identifying resistance zones and using the Elliott Wave theory.

Analysis

- To begin with, Litecoin has broken out of a bullish descending wedge formation, similar to EOS
- Litecoin has been consolidating within this pattern for weeks before breaking out with immense bullish momentum
- The Exponential Moving Average (EMA) Ribbon shows a golden cross as Litecoin broke out
- Counting Elliott Waves, we can see Elliott Impulse Waves (12345) leading up to the descending wedge
- Within the wedge pattern, it consolidated in Elliott Triangle Waves (ABCDE)
- Having broken out from the pattern, it's anticipated that Litecoin would form bullish impulse waves once again
- While the trend is extremely bullish, there are some concerns as well
- Litecoin faces major historical resistance around 63.13 USDT
- The Relative Strength Index (RSI) is also extremely overbought
- The Moving Average Convergence Divergence (MACD) shows decreasing bullish histograms as it looks to potentially form a death cross

What We Believe

While the outlook on Litecoin remains bullish, based on current technicals, a small corrective wave is highly probable, considering the steepness of the rally. However, we believe that the bullish trend will remain intact, given that the degree of correction is not too severe.

Let us know what you think in the comment section below


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