While the altcoin market is experiencing larger declines, Litecoin (LTC) still has the potential to sustain a long-term uptrend. To do this, the LTC price needs to create a symmetrical triangle pattern and initiate a recovery.
If LTC price can break through the long-term resistance area between $100 and $105, it will be a strong signal for the start of a new bull market.
However, if LTC loses the key support at $65, it would mean that the bullish structure is broken and could push the price back towards the June 2022 lows.
CONDITIONS TO KEEP LITECOIN’s UPtrend
On the weekly chart, Litecoin has maintained an uptrend since bottoming at $40.3 in June 2022. Since then, there has been a year-long accumulation phase. Currently, there are signs that this altcoin is forming an impetus pattern for a new uptrend.
On the chart, Litecoin price has made three higher highs (HH) and three higher lows (HL). If the price fails to drop below the previous low of $65, the current drop could represent a higher low Wednesday and potentially the start of a long-term uptrend.
On the VPVR (Volume Profile Visible Range) chart, the $65 price level plays an important role and is a long-term support level (shown by the red line). The VPVR indicator is used for volume-based trading and is very useful when trading large-cap assets.
However, Litecoin’s uptrend has encountered a triple resistance at the long-term resistance area between $100 and $105 (red rectangle).
Additionally, the weekly Relative Strength Index (RSI) has broken the upward (black) support line, established since the June 2022 bottom. The RSI is currently below the 50 level, indicating a bullish bias. downward direction.
Finally, trading volume is decreasing from the historic high (ATH) and the next low in May 2021. The descending pattern of volume (blue line) seems to be completing, suggesting It is likely that a significant change is about to take place.
LTC PRICE SET Symmetrical Triangle Pattern
Technical analysis from the daily chart shows conflicting signals from the weekly chart. First, Litecoin is forming a symmetrical triangle pattern. This shows that the probability of both a breakout and a breakdown from this pattern is the same.
However, there is a sign of strengthening for the downside as Litecoin is trading in the lower part of the pattern and is not even able to maintain its current position.
In the event of a drop, holding the $65 level (green line) is crucial to sustaining the uptrend. This level has acted as support and resistance many times in the past.
On the other hand, trading volume supports the upside potential. Analysis of daily trading volume from May 2022 shows that on June 10, 2023, Litecoin created a fourth-biggest red candle.
Such large red candles recorded earlier often signal market capitulation and bottoming events (like the green arrow on the chart).
So, if Litecoin continues to form a symmetrical triangle, the current move could just be a correction following the bull run from earlier this year.
Here is the interpretation from crypto market analyst @CryptoTony__, who shared his chart on Twitter. According to the expert, when both sides of the pattern are confirmed, Litecoin price could have a strong breakout.
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