Litecoin Price Analysis: LTC completes technical framework for a 20% rally


Share:
  • Litecoin is on the verge of a massive technical breakout from a falling wedge pattern.
  • The MVRV ratio shows that LTC is in a buy zone, which is a bullish signal.
  • Litecoin’s expected breakout may delay due to the resistance illustrated by the IOMAP.

Litecoin is trading 2% higher over the last 24 hours. It is among the few coins dotting the cryptocurrency market green. Meanwhile, short-term technical analysis suggests that a breakout is around the corner, especially with the formation of a falling wedge pattern.

Litecoin flashes massive buy signals

The cryptocurrency is holding in the tenth position, with a market cap of $12.8 billion. A breakout toward the recently traded multi-year high would ensure that LTC remains among the top ten assets.

In the meantime, Litecoin is exchanging hands at $191 while battling the resistance at the upper trendline of a falling wedge pattern. This pattern is bullish and results in a massive upswing in maturity. The pattern forms after a considerable upswing in price followed by a period of correction.

A breakout equal to the distance between the highest and lowest points of the pattern is expected as soon as the price slices through the upper trend line. For instance, Litecoin is on the brink of a 20% breakout, likely to bolster it to $211.

The Moving Average Convergence Divergence (MACD) on the 4-hour chart shows that the trending is about to flip bullish. The MACD line (blue) crosses above the signal line, which is called to buy the dip. Moreover, recovery of the indicator into the positive area will catapult LTC significantly upwards.

LTC/USD 4-hour chart

LTC/USD 4-hour chart

The MVRV on-chain ratio vividly shows Litecoin inside the buy zone. This metric by Santiment tracks the average profit or loss of the holders of LTC tokens that have been moved over the last 30 days compared to the price when each of these tokens last moved.

Note that an MVRV ratio of more than figure 2 implies that Litecoin holders are currently 2x on their initial investment. On the contrary, an MVRV figure of one or less shows that holders are at a loss or yet to break even on their investment. Therefore, they are unlikely to sell, maintaining the buying pressure behind the token.

Litecoin MVRV on-chain metric

Litecoin MVRV on-chain metric

Looking at the other side of the picture

IntoTheBlock’s IOMAP model brings to light intense resistance ahead of Litecoin, which is likely to delay the breakout. The most robust seller congestion zone holds between $197.7 and $203.3. Here, around 135,800 addresses had previously scooped roughly 3.8 million LTC.

Litecoin IOMAP model

On the downside, Litecoin is sitting on top of an area with immense support highlighted between $180 and $186. Here, nearly 92,000 addresses had previously bought approximately 3.3 million LTC. It is doubtful that Litecoin will slice through this zone thus, giving way to a consolidation period.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Join Telegram

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended Content

Editors’ Picks

Two key dates over the SEC request to freeze Binance assets

Two key dates over the SEC request to freeze Binance assets

Crypto exchange Binance must respond to the US Securities Exchange Commission’s (SEC) order to freeze assets tied to its subsidiary Binance.US by June 12, ahead of a court hearing about the case on June 13, according to the D.C. district court schedule.

More Cryptocurrencies News

Ethereum price declines as Coinbase ETH liquidity staking platform sees mass withdrawals

Ethereum price declines as Coinbase ETH liquidity staking platform sees mass withdrawals

The US Securities and Exchange Commission’s (SEC) crackdown on Coinbase led to  mass withdrawals of Coinbase wrapped staked Ether (cbETH) since Tuesday, acting as a bearish catalyst for the asset’s price.

More Ethereum News

Dogecoin Price Prediction: History suggests a potential 30% rally in DOGE

Dogecoin Price Prediction: History suggests a potential 30% rally in DOGE

Dogecoin (DOGE) price has been trading within a fixed range over the last six months, taking seasonal leaps as volatility increased. With this accumulation pattern, the king of meme coins could be en route to complete the next bounce cycle.

More Dogecoin News

Axie Infinity price recovery delayed despite investor deposits hitting a five-month high

Axie Infinity price recovery delayed despite investor deposits hitting a five-month high

Axie Infinity price, following the broader market cues, is trending downwards for the moment as the bearishness in the market has grown considerably. Incited with the regulatory crackdown by the SEC, the investors have resorted to offloading their holdings for now.

More Axie Infinity News

Bitcoin: BTC targets $30,000 as short-term bias turns bullish

Bitcoin: BTC targets $30,000 as short-term bias turns bullish

Bitcoin (BTC) price shows a clear sign of the bulls’ victory. After failing to trigger a steep correction, bears look now out of context, at least in the short term, allowing buyers to restart a minor uptrend. 

Read full analysis

BTC

ETH

XRP