Litecoin continues to grind higher
Litecoin continues to grind higher during the trading session on Wednesday, bouncing towards the $95 level. LTC has been in an uptrend for some time and there is a purple circle showing where we have seen a significant stand by the bullish. We have seen a perfect coincidence of several technical factors.
Significant technical levels
As you can see on the chart, we have bounced from a major trendline as shown by the purple circle, but there is also the 68.1% Fibonacci retracement level and that vicinity as well. The complete reversal of the bearish candle that slammed into that trend line, of course, is a good sign of strength, but we also have the blue 200 day EMA in that area as well. You will notice that we bounced right into the 50 day EMA, which is pictured in red. We pulled back from there and have since tested the 200 day EMA again to form a hammer on Monday, finally culminating in this most recent bounce. With that, it looks as if Litecoin is ready to continue to move higher.
Several levels for targets
The Litecoin market seems to be divided up in $25 increments, as shown on the chart. Because of this, I look at the chart approaching the $100 level as crucial. In this sent is in this sense, if we can get a daily close above the $100 level, and by extension the 50 day EMA, the market should continue to go higher, perhaps reaching towards the $125 level. Pullbacks from here should continue to find plenty of interest though, all the way down to at least the trend line, if not the $75 level.
The potential trading environment
The potential trading environment that we see is one that is trying to build up enough momentum to finally break out to the upside, as we not only have all of those technical factors involved, but we also have the potential of forming a bit of a symmetrical triangle, which shows that the market is trying to build up the inertia to go much higher. Ultimately, this is a market that might be a bit choppy, but I do think that given enough time Litecoin will continue to rally right along with other cryptos, especially considering that the Federal Reserve is likely to cut interest rates which will work against the value of the US dollar, the other side of this trade. At this point, the market should perhaps bounce a bit due to the fact that a falling US dollar should naturally push the other side of the market higher. Beyond that, people will be looking to protect their wealth any way they can, so alternative investments such as gold and cryptocurrency should continue to get a bit of a bid. Ultimately, buying on the dips should continue to work as long as we can stay above that $75 level, an area that is a huge confluence of support.