Litecoin (LTCUSD) 1H Chart 3/18; click to enlarge)
In the previous litecoin post, we looked at a possible price top forming as the virtual currency consolidated around 2.00 with a support around 1.97. During the 3/18 session, this support broke, and litecoin fell sharply tagging 1.60 by the start of the 3/19 session.
The 1H chart shows the dramatic dip, which was accompanied with heavy volume. Even though this is just one swing, it is indicative of a market turning bearish after slowly climb in February.
In fact, today’s dip completely wiped out February’s gains, cracking the February low near 1.67.
Litecoin (LTCUSD) 4H Chart 3/19
(click to enlarge)
The 4H chart shows the dramatic slide trying to expose the 1.10 low on the year by breaking a late-January, early February consolidation support. However as we enter the 3/19 session, we can see that there are buyers around 1.67-1.70. As the 4H and 1H RSI readings dip into oversold conditions, we expect at least a near-term rally. If this occurs, the 1.80-1.90 area will be key.
A bearish market should respect 1.80, and if not, the 1.90 area. A hold under 1.80 would be a sign of respect to an early-March consolidation support as resistance. Above that, a bearish market would still be in play under 1.90. Under 1.90, ltcusd would remain below the cluster of 200-, 100-, and 50-period SMAs in the 4H chart and thus clearly retain the bearish bias.
We should also monitor the 1H RSI reading. If price stalls after a rebound into the 1.80-1.90 area, we should expect a bearish attempt especially if the 1H RSI stalls around 60. This would reflect maintenance of the short-term bearish momentum. Then, if we see bulls unable to mount a significant rally above 1.90, the pressure should remain on the 1.67 support, with risk of extending lower towards the 1.10 low on the year.
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