Litecoin [LTC]When and how traders take advantage of this opportunity

warning: The results of the following analysis are the author’s opinions only and should not be considered investment advice

Litecoins [LTC] The recent bounce from the base line of $52 put the coin in a good position to test the resistance barrier in the $62-$64 range. The recovery raised short-term buying hopes. However, the resistance range has undermined the bullish efforts of the past three months while preventing a streak of green lights.

Meanwhile, the altcoin has posted a reversal pattern on the daily chart. The continued rejection of higher prices near the $62-64 range could lead to a short-term pullback. At the time of writing, LTC is trading at $62.88 on the charts.

LTC daily chart

Source: TradingView, LTC / USD

Overbought in LTC led to sharp higher highs along with slightly higher lows. This path took the form of a rising rising wedge during this time frame. This pattern is quite bearish as most of the time it records a downside breakout.

After a strong 20% ​​growth from the bottom line of the pattern, LTC has seen signs of a reversal from the $64 region. These gains helped the currency to close above the 20 EMA (red) and the 50 EMA (cyan).

Although these EMAs have completed a bullish crossover, they may present rebound trends for a potential pullback.

A break below the $62 level could help the sellers trigger a decline towards the $58.6 level near the time of the 20 EMA’s publication. Any close below this support could expose the alternative to a longer decline. In this case, LTC may head towards the $53 area before the bulls step in to increase buying pressure.

Any bounce above the $64 level would confirm bearish reversal and suggest buy signals.

Logic

Source: TradingView, LTC / USD

The Relative Strength Index (RSI) revealed an increasing buying advantage, but settled at the 60 mark resistance level. The bulls have struggled to find a comfortable close above this mark for more than five months. Buyers should look for a breach of this level to confirm invalidation of the downtrend.

However, the lower tops of the Volume Oscillator (VO) highlighted a somewhat bearish divergence. This reading predicted weakness of the previous uptrend. However, the trend of altcoins is trending [ADX] She was still struggling to improve her weak position.

conclusion

As the resistance range between $62-$64 is strengthening along with a reversal pattern, LTC may see ease in reviving buying pressure.

However, the bullish crossover of the 20/50 EMA kept long-term recovery hopes alive near the $58 region. The objectives will remain as discussed.

Finally, LTC shares a 61% 30-day correlation with BTC. Thus, having a look at the movement of Bitcoin will be crucial to making a profitable move.

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