Cryptocurrencies bitcoin and litecoin are starting this week on a strong note, more noticeably in bitcoin than litecoin. Still LTCUSD is now confirming a breakout from a range, and threatening to breakout of the larger consolidation ranges. Let’s take a look at the charts.
Litecoin (LTCUSD) 1H Chart 3/2
(click to enlarge)
The 1H chart shows a narrow consolidation that has been holding price between roughly 1.77 and 1.90. The market loss volatility and direction as it was trapped here, but became bullish after a breakout above 1.80 to start the month and this week.
We also saw a couple of pullback attempts that eventually respected the 1.80 area as support. This is a strong sign for the bullish outlook. The RSI is also indicative of a market building bullish momentum at least in the very short-term. What does this breakout and confirmation mean for the larger picture?
Litecoin (LTCUSD)4H Chart 3/2
(click to enlarge)
After making a low on the year around 1.10, litecoin surged to 2.43. This is seen as a corrective swing that has established a range for consolidation. Price has indeed continued to consolidate within the 1.10-2.43 range, but the volatility became narrower. Now that price is breaking above 1.90, the next resistance around 2.05 is in sight before exposing the 2.43 high.
Now, if price falls back below 1.84 instead of extend above 2.05, we should put the pressure back towards the 1.78 low, with risk of returning towards the 1.10 low on the year, especially because this week’s bullish breakout would have been a false one.
So, the answer to whether litecoin will join bitcoin’s surge, is that it is already following suit albeit at smaller volatility. Still, we should take bitcoin’s price action as a hint for litecoin’s.
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