Litecoin opens the week with a bang
The crypto markets have been bullish during the trading session on Monday, as the markets have opened up rather bullish for cryptocurrency. This makes a lot of sense, because quite frankly the trade wars are heating up, not cooling down and people are looking for some type of shelter from the potential fallout. The cryptocurrencies seem to be a refuge in these times, but we are starting to see Litecoin hype itself up in the process.
The moving averages on the chart are starting to flatten out, and I should point out that the 50 day EMA has offered significant resistance. The $100 level is also sitting right there with that moving average, and below we have the 200 day EMA which is sitting near the $84 level. With the moving averages flattening out, it looks likely that the consolidation is trying to build up enough momentum to go in one or another direction.
That being said, it does look like we have some work to do. We did peek through the 50 day EMA during the trading session, and then pulled back. At this point, the market certainly looks as if it is trying to break out but it is going to take a significant amount of momentum to do so. That being said, we also have a nice trend line just below the moving averages that could come into the picture.
The US dollar has been thrown around in the Forex markets over the last 24 hours, and therefore I think that although the US dollar does offer a bit of safety, there are a certain amount of traders out there that are more than willing to short the US dollar against a cryptocurrency such as Litecoin.
The trade going forward
The trade going forward in this pair is quite simple, simply look for pullbacks to take advantage of as they offer plenty of value. Alternately, if we can break above the recent highs, at roughly $110, then the Litecoin market should continue to go much higher, perhaps reaching towards the $120 level, and then eventually the $125 level. Underneath, there is enough support near the $80 level based upon the moving averages, the uptrend, and of course the moving averages. In other words, this is a market that should be bought and not sold but you should also see short-term charts offering nice pullbacks that we can take advantage of.
The purple circle shows a recent low that if it did get broken through, then we could reach down towards the $50 handle. Ultimately though, it doesn’t look like it’s being threatened and quite frankly this looks a lot like a bottoming pattern that is trying to start a continuation to the upside, perhaps even as high as the $145 level. All things being equal, I do believe that the market is one that should be looked at through the prism of “value”, as Litecoin looks like it has further to go over the longer-term.