The Litecoin (LTC) price has decreased since reaching a yearly high of $115 in July.
The price also broke down from a short-term ascending support trendline. Will $60 hold or fold next?
Litecoin Falls After Deviation
The weekly timeframe technical analysis for Litecoin shows that the price broke out from a 770-day descending resistance trendline in June, reaching a new yearly high of $116.
This seemingly caused a breakout between the trendline and the $105 resistance area.
But, the cryptocurrency did not sustain its increase. Rather, it deviated above the $105 resistance (red circle) and then fell sharply below it.
The LTC price decreased below the long-term trendline in August. It is currently trading slightly above the $60 horizontal support area.
The weekly RSI gives a bearish reading. With the RSI as a momentum indicator, traders can determine whether a market is overbought or oversold and decide whether to accumulate or sell an asset.
Bulls have an advantage if the RSI reading is above 50 and the trend is upward, but if the reading is below 50, the opposite is true. The RSI is below 50 (red icon) and falling, both signs of a bearish trend.
Litecoin Price Prediction: What Will Happen Next?
The daily timeframe readings are mixed, slightly leaning bearish.
The main reason for the bearishness is the price action. Litecoin broke down from an ascending support trendline on October 4, indicating that the previous upward movement is done. A similar decrease has been seen in the rest of the crypto market.
The reaction to the minor $68 resistance area is also bearish. The altcoin deviated above it in August and then failed to break out twice before falling below the ascending support trendline.
While the Litecoin price action is bearish, the RSI still offers hope for a bullish trend reversal. This is because the bullish divergence trendline (green line) that preceded the increase is still intact.
A bullish divergence occurs when a momentum increase accompanies a price decrease. It often leads to trend reversals.
In any case, the divergence trendline cannot negate the bearish price action. If the decrease continues, LTC can fall by another 9%, reaching the minor support at $58.
Despite this bearish Litecoin price prediction, a reclaim of the ascending support trendline and $68 area will mean that the trend is bullish.
A 30% increase to the next resistance at $83 could occur in that case.
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Disclaimer
In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions.
Source: https://beincrypto.com/litecoin-price-trend-shows-weakness/