Litecoin Sees Free Fall after Exiting a Triangle
|LTC/USD tumbled yesterday, breaking below the lower bound of a triangle formation that contained the price action from June 27th. After the exit, the crypto entered a free-fall mode, which continued today as well. It rebounded somewhat after hitting support slightly below the 97.00 area, which is marked by the low of June 4th and the inside swing high of May 20th, but the bears were quick to recharge again. Thus, having all these technical signs in mind, we will adopt a negative stance with regards to the short-term picture.
If the bears are willing to stay behind the steering wheel, we would expect them to aim for another test near 97.00, the break of which may open the way towards the 93.00 hurdle marked by the inside swing high of May 21st. If that zone is not able to halt the slide either, its break may carry more bearish implications, perhaps setting the stage for the 85.00 key territory, near the lows of May 22nd and 23rd.
Shifting attention to our short-term momentum studies, we see that the RSI lies well below its 30 line and still points south, while the MACD stands below both its zero and trigger lines, pointing down as well. These indicators suggest that the downside speed remains strong and support the notion for some further declines.
On the upside, we would like to see a rebound back above 105.00 before we assume that the bears have stepped aside for a while, thereby allowing a positive corrective move. Such a break could initially aim for the 110.00 barrier, the area around which acted as decent support on June 27th and July 2nd. Now, in case the recovery continues above 110.00, then we could see a test at our next resistance zone, near 116.00.
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