Litecoin is holding up fairly well at $2.955 after Bitcoin successfully retested the important support level of $235. The cryptocurrency is up 1.65 percent but it may have entered into a range of $2.500-3.160.
My view above is based on the price action and the latest technical indications drawn from the daily LTC-USD price which fail to induce much confidence.
Litecoin Chart Structure – Litecoin’s fall was arrested by a swift rise in the price of Bitcoin after it kissed $235. Apart from Bitcoin’s contribution, Litecoin also received good support from the 9-day simple moving average of $2.8840.
$3.160 will act as the resistance while $2.500 will act as the support.
Moving Average Convergence Divergence – MACD and Signal Line can be seen tracking each other’s gains and therefore, are limiting the appreciation of Histogram. The Histogram currently has a value of 0.0789, the MACD is still negative at -0.1683 while the Signal Line is at -0.2472.
Money Flow Index – After a brief climb down, MFI can be seen surging again. The value has now touched 57.5821.
Relative Strength Index – The strength in Litecoin remains vulnerable to any bearish action. The latest 14-day RSI reading is 43.5517.
Conclusion
Although I have said it before, but the importance and influence of Bitcoin over the Litecoin market cannot be stressed enough. Market participants must have noticed that Litecoin is closely tracking the action and direction of Bitcoin and the only difference is that of the magnitude.
I will be very surprised if Litecoin is able to breach the resistance of $3.160 in the next 24-36 hours. Beyond this technical hindrance, expect a spurt in price to levels north of $3.500, however, sustenance will definitely be an issue then.
Traders interested in trading this range should short near $3.160 for a target of $2.850 by maintaining a tight stop-loss.