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Litecoin Price Analysis LTC / USD: Treading Water

LTC needs to reach the $96 level to avoid further losses.

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  • Litecoin is struggling to move price back above the technically important $96.00 level and remains capped below its 200-day moving average
  • The daily time frame continues to show a bearish head and shoulders pattern with the $50.00 level as the overall downside target

Litecoin appears relatively unsteady on Tuesday, after the fifth largest cryptocurrency by market capitalization found strong technical resistance from just shy of the $80.00 level. The recent grind higher from the $70.75 level appeared to lack bullish momentum, with the LTC / USD pair so far failing to staging a meaningful rally from depressed levels.

Going forward, the LTC / USD pair is likely to remain technically pressured unless buyers can somehow force price back above the $96.00 resistance level. The $96.00 level is extremely important technically for the LTC / USD pair this week for numerous reasons.

The $96.00 level is the neckline of a large head and shoulders pattern, which could eventually see the LTC / USD pair falling as low as the $50.00 level, according to its overall downside projection. The $96.00 level is also the LTC / USD pair’s 200-period moving average on the four-hour time frame, which remains a key determinant of short-term trading sentiment.

SIMETRI Research

We should also remember that the LTC / USD pair is trading below its 200-day moving average for the first time since February this year, so the short and medium-term trend for the Litecoin has now officially flipped to bearish.

According to the latest sentiment data from TheTIE.io, the short-term sentiment towards Litecoin is slightly bearish, at 48.48 %, while the overall long-term sentiment towards the cryptocurrency is also negative, at 46.31%.

 

LTC H4 Chart August 20 by TradingView
LTC / USD H4 Chart by TradingView


Upside Potential

The one-hour time frame is showing that if bulls break above the $80.00 resistance level, then a move towards the $90.00 level appears likely due to emergence of a small inverted head and shoulders pattern with a $10.00 upside projection.

The daily time frame highlights the recent price consolidation inside a tight $10.00 price range, with the LTC / USD pair’s 200-day moving average located slightly above the top of the recent price range, at $83.65. If bulls can gain strength above this level, we should expect bulls to possibly mount a challenge towards the $96.00 level.

 

LTC Daily Chart August 20 by TradingView
LTC / USD Daily Chart by TradingView

                                                                                

Downside Potential

The downside potential for the LTC / USD pair can really start to open-up this week if sellers move price under the $70.00 support level. The one-hour time frame continues to highlight that critical trendline support is located around the current monthly trading low.

The daily time frame is also highlighting that the LTC / USD pair continues to trade below the neckline of a large head and shoulders pattern, with a downside projection of around $50.00. A move below the $70.00 level is likely to quickly increase technical selling towards the $60.00 level, although the down move is likely to extend down towards the $50.00 support level.


Summary

Litecoin is vulnerable to more downside while trading below the $96.00 level. Bulls must stabilize price above the pair’s 200-day moving average to try to encourage a fresh wave of technical buying.

Overall, if the $70.00 support level is broken this week, the LTC / USD pair could see a much deeper decline towards the $50.00 level.

 

Check out our coin guide for an introduction to Litecoin.

We also wrote a DARE for the project, analyzing the future prospects of the Bitcoin competitor.

 

Litecoin Chart

 

DISCLOSURE

Authors at Crypto Briefing are invested in cryptocurrencies. The author of this post may be invested in digital assets mentioned here.

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