Litecoin’s turning point was on 23 July after its price closed above its upper sloping trend. This marked a shift from LTC’s downtrend which extended from its late-May levels. The digital asset is now preparing to reclaim areas lost over several retracement stages in June.
At the time of writing, Litecoin was valued at $144.8, up by 4.5% over the last 24 hours.
Litecoin Daily Chart
Source: LTC/USD, TradingView
The Pitchfork tool was plotted on LTC’s rally from its 2o July swing low of $103.8 and the following correctional phase. The decline saw buyers return at LTC’s 78.6% Fibonacci Extension which rested at $137.68. The next resistance zone is at the 100% Extension level and a close above this can push LTC towards the median line of the Pitchfork ($150).
Additional targets lay at $158.58 and $173.45. To invalidate such an outcome, the market’s bears need to target a decline below the 78.6% Fib level.
Reasoning
After bouncing back from the oversold zone on 20 July, the RSI formed its second peak at 63. A higher peak would indicate further upside going forward. The On Balance Volume also pointed to a rise in northbound pressure over the past few days.
However, LTC could see a minor decline before the next upcycle is initiated. This assertion can be backed by the MACD’s histogram which showed that bulls were losing momentum as the price approached $146.88. Failing to topple this ceiling might result in a retest of $137.68.
Conclusion
Litecoin’s close above its 100% Fibonacci Extension would validate a hike towards the $150-mark. However, there were signs of weakening bullish momentum and traders must be cautious of a close below the 78.6% Fib level. This scenario would negate a bullish thesis for LTC over the coming days.
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