Descending resistance line
LTC has been falling below descending resistance line since March 30. The decline fasten when this line rejected price on May 5 (red icon). After that, the downtrend led to price tumble as low as $40.30 on June 14, which is a new yearly low.
While LTC price bounced after that, it was rejected by the horizontal resistance zone of $56.50, which is very close to the aforementioned descending resistance line. LTC needs a breakout from both this line and zone to return to the uptrend.
Trend reversal failed
The daily timeframe does not provide any indication of a possible bullish reversal. The two main reasons for this are the RSI being rejected by the 50 level (red icon) and the lack of bullish divergence (green line).
Until the RSI moves above 50, there will be no uptrend. Due to its proximity to this line, a rise of the RSI above 50 is expected to help the price break above the descending resistance line and the $56.5 resistance zone.
Short-term movement
Trader @BigCheds tweeted an LTC chart, showing that a short-term pullback is expected as the price is trading close to resistance. Since the tweet, LTC price has dropped significantly after being rejected by the aforementioned resistance level.
More importantly, it fell from the support line of an ascending parallel channel. Such channels often contain corrective movements, which means that breakdowns are foreseen. The support line is now at $51.
If this happens, the next support zone will be $43, created by the June and yearly lows.
Disclaimer: This article is for reference purposes only, not investment advice.
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