- The price of Litecoin failed to retrace past the 0.5 fib line of the drop from $41 to $30.
- Price just made a bearish engulfing 2-hour candle.
- Price is following a short-term ascending support line.
- The daily MACD is close to making a bearish cross
Litecoin [LTC] Price Analysis – Daily Chart LTC/USD
The price of the LTC/USD pair is struggling to break through the resistance offered by the 50-day moving average, similar to the failed attempt on January 8th to break past $41. The start of the day has given us an extremely bearish outlook, with a drop of 5% (from $35.5 to $33) occurring in less than 10 hours. (All data are taken from the LTC/USD pair on Bitfinex)
A look at the Daily chart shows that price made a second unsuccessful attempt to break through the 50-period MA (blue line) and got rejected. Price retraced and has currently found support at the 7-period MA, which has recently made a bearish cross. It is of importance to keep an eye on the daily closing price since the first 9 hours of the day were extremely bearish. While the LTC/USD price opened at $35, it is currently trading at $33.2, a drop of 5%. Furthermore, the MACD is losing its power and setting itself up to make a bearish cross. It is of importance to keep an eye on the MACD since the bearish cross could occur during the next 2-3 days.
A closer look at the 2-hour chart shows us that after launching an upward rally on January 28th, price failed to retrace past the 0.5 fib line of the drop from the $42 high to the $30 low. After two unsuccessful attempts to break past the 0.328 fib line at $34.3, the price was successful on the third attempt, but immediately got pushed back once it reached $35.5. Price formed a bearish engulfing 2-hour candle (yellow arrow) on very significant volume and has retraced back all the way to the 200-period MA, forming an ascending support line in the process. A break below the 200-period MA and the support line would put the recent support area at $30.5 into play. Furthermore, the 7 and 21 period MAs are very close to making a bearish cross, placing the price firmly into bearish territory.
- The closest support area is near $29, with major support near $23.
- The major resistance area is near the January 8th top at $41.
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