Bitrabo Editorial
In spite of the bearish altcoin market, Litecoin (LTC) could maintain its long-term uptrend if it validates the symmetrical triangle formation and initiates a bounce. Breaking the long-term resistance area within the $100 to $105 range would signal the start of a new bull market. Nevertheless, losing the key support level at $65 would mean a breakdown of the upward structure and a possible return to the June 2022 lows.
Litecoin’s Uptrend Struggles
The weekly chart indicates that Litecoin has been rising since touching a low of $40.30 in June 2022. This marks the beginning of the year-long accumulation phase, which appears to be forming the basis for a new uptrend.
First, the LTC price has generated three higher highs (HH) and three higher lows (HL). If the price doesn’t fall under the $65 level, the ongoing decline could be the fourth higher low, marking the potential start of a long-term uptrend.
The $65 level is particularly important on the VPVR (Volume Profile Visible Range) chart since it serves as long-term support. The VPVR indicator is useful for volume trading and is effective for large capitalization assets.
The weekly Relative Strength Index (RSI) has already broken down from the rising support line (black), which has been in place since the June 2022 lows, and this signals a bearish trend as it’s below 50.
Furthermore, trading volume appears to have been steadily declining since the ATH and subsequent May 2021 low. The pattern of declining volume (blue line) suggests that a sharp impulsive move is imminent. However, the volume signature remains neutral on the expected move’s direction.
LTC Price in a Symmetrical Triangle
Technical analysis from the daily interval provides mixed signals from the weekly interval. Litecoin seems to be in a neutral symmetrical triangle formation, and the probability of breakout and breakdown from such a formation is similar.
However, on the bearish side, Litecoin is presently trading at the lower edge of this formation, even apparently losing it.
If a dip occurs, retaining the previously mentioned $65 level (green line) will be a crucial factor in maintaining the uptrend. This level has repeatedly worked as both support and resistance in the past.
On the bullish side, the trading volume signature supports the interpretation. Looking at the daily trading volume from May 2022, we see that on June 10, 2023, Litecoin generated the fourth-largest red candle, and all previous such large red candles signaled capitulation and a market bottom (blue arrows).
Therefore, if Litecoin maintains the validity of the symmetrical triangle formation, this ongoing move may just be a correction after earlier this year’s gains.
Cryptocurrency market analyst @CryptoTony__ suggested this interpretation on Twitter, and he posted his chart to back it up. According to him, once both edges of the formation are re-confirmed, the LTC price may break out to the upside.
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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. Bitrabo is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your research and consultation with a professional before making any financial decisions.