Litecoin Price Analysis: LTC/USD false breakout culminates in a bull trap
|- Litecoin fails to sustain gains towards $50, instead, corrected to test the support range between $43 - $44.
- The falling wedge pattern is likely to boost Litecoin’s jump above $50 in the near term.
Litecoin is trading at $44.33 after a minor recovery from $43.93 (intraday low). Over the last few days, apart from yesterday, Litecoin has been forming a lower high and a lower low pattern. The two trendlines connecting the lows and highs created a falling wedge pattern. A breakout from the pattern on Thursday in a bullish engulfing pattern jumped above $46 and $47 hurdles respectively.
However, the gains became unsustainable forcing LTC back inside the wedge pattern. The region between $43 and $44 is coming up as credible and formidable support for Litecoin. However, the upside continues to be hampered.
The RSI has avoided the levels below 30 since the recent sharp losses saw Litecoin dive to $42. In other words, Litecoin oversold conditions are still at bay and declines are likely to continue amid the hunt for a proper bottom.
The gap between the 50 SMA at $45.29 on the 1-hour chart and the 100 SMA at $46 puts emphasis on the presence of the sellers. Litecoin must focus on trading above $50 to come out of the bearish range as well as the falling wedge pattern.
LTC/USD 1-hour chart
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