• Litecoin price steadies at the 78.6% Fibonacci retracement level after nine consecutive down days.
  • On July 21, LTC records the best day since the May 31 gain of 10%.
  • The digital asset is positioned below the 50-week simple moving average (SMA), forecasting a challenging long-term recovery.

Litecoin price recorded nine consecutive down days and an oversold reading on the daily Relative Strength Index (RSI) before the 9.8% gain on July 21. The rebound from the 78.6% retracement level of the 2020-2021 advance marked the second time the cryptocurrency bounced at that level over the past month, confirming it as legitimate support moving forward. More importantly, LTC is constructing a new, timely entry price to accommodate those investors arriving late.

Litecoin price shapes new base structure

Litecoin price has quietly molded a falling wedge pattern with exceptional support at the confluence of the 78.6% retracement level at $108.23 and the June 22 low of $105.00. The falling wedge emphasizes waning momentum in the decline and the potential for a bullish LTC outlook.

During the 9.8% burst higher on July 21, Litecoin price triggered an entry price highlighted in an FXStreet article on July 20 at $115.06. The successful breakout above $115.06 was a timely opportunity for investors. Still, LTC may be establishing a new, actionable opportunity, as it is shaping a cup-with-handle base on the four-hour chart. The handle is finding support a long the 50 four-hour SMA, currently at $117.97. 

The current entry price for the new structure is the high of the handle at $122.24, and the measured move of the base is nearly 18%, presenting a price target of $143.79. A rally of that size would break Litecoin price out of the falling wedge pattern, overcome resistance at the 50-day SMA at $142.52 and leave LTC just below the critical barrier formed by the 2019 high of $146.00. 

For those LTC investors that capitalized on the $115.06 trigger, it would represent a 25% profit.

LTC/USD 4-hour chart

LTC/USD 4-hour chart

Of course, Litecoin price could suffer a sell-off, but it may create another opportunity.  On a pullback, LTC investors can use the 78.6% retracement level at $108.23 as a point of entry, with the July 20 low of $103.88 as the stop. Any weakness beyond the July 20 low would signal a drop to the falling wedge’s lower support line at $94.00.

LTC/USD daily chart

LTC/USD daily chart

LTC is not the most compelling opportunity in the cryptocurrency complex. However, the availability of a secondary entry price with the cup-with-handle base does offer a fresh, high probability entry price. For sure, it is better than chasing Litecoin price and exposing capital to unnecessary volatility and losses.

Here, FXStreet's analysts evaluate where LTC could be heading next.

 

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.

Cryptos feed

Latest Crypto News


Latest Crypto News & Analysis

Editors’ Picks

XRP price to pull a 180 as Ripple bulls come out of the woodwork

XRP price lacks volatility as it trades close to a crucial support level. While a major reason for this is its correlation with Bitcoin, a part of it also arises from the lack of interest among the investors for this coin. There is a good chance Ripple could see a brief uptrend that pushes it toward the immediate resistance barrier.

More Ripple News

MATIC price gives bulls another opportunity to undo recent losses

MATIC price has seen an increase in selling pressure that has undone most of its gains from the last week. The retracement has knocked Polygon down to a stable barrier that is likely to sustain the incoming bearish momentum, allowing bulls to make a comeback.

More Polygon News

Crypto.com upside limited to $0.54 as CRO faces multiple hurdles

A brief technical and on-chain analysis on Crypto.com price. Here, FXStreet's analysts evaluate where CRO could be heading next.

More Crypto.com News

Google prepares for a foray into crypto, plans to expand payment division

Google is planning to enter into the cryptocurrency space as the firm has hired a former PayPal executive to lead its payment division. The multinational technology company is laying out a broader strategy to team up with a wider range of financial services including digital assets.

More Cryptocurrencies news

BTC eyes retest of $50,000

Bitcoin price shows a resurgence of retail interest as it bounced off a crucial psychological level. The recent uptrend is preparing a base on a short-term time frame so BTC can kick-start a larger leg-up. Interestingly, on-chain metrics are lining up with the bullish outlook portrayed from a technical perspective. An uptrend now seems inevitable for BTC and, therefore, the larger ecosystem.

Read full analysis

BTC

ETH

XRP