LTCUSD is trending lower on its 1-hour time frame as the excitement over digital currencies appears to have faded. Price is moving in a descending channel visible on its 1-hour chart and has just bounced off support.

Another test of the channel resistance around $30 could be underway but price already seems to be stalling at the mid-channel area of interest. The 100 SMA is below the 200 SMA so the path of least resistance is to the downside. Also, these moving averages are in line with the middle of the channel, adding to its strength as near-term resistance.

Stochastic is on the move down to indicate that sellers are in control of LTCUSD price action. RSI hasn’t quite reached the overbought zone just yet but already seems to be turning lower to reflect a pickup in bearish pressure. In that case, LTCUSD could move back down to support around $22.

Litecoin continues to pale in comparison to bitcoin, which has raked in most of the cryptocurrency gains in the past few weeks. However, LTCUSD is also being dragged lower by profit-taking across the board while traders exit their long positions in waiting for the next upside catalyst for the cryptocurrencies.

Meanwhile, dollar demand has ticked higher after seeing stronger than expected Q1 GDP from the US economy. Recall that the advanced GDP reading turned out weaker than expected and dampened rate hike speculations, especially since the odds of a Fed rate hike seemed lower in the wake of the investigation into Trump’s intelligence information leak to Russia.

However, the focus seems to be shifting back to tax reform and Fed tightening once more as the FOMC minutes indicated that policymakers are simply waiting for more signs that the slowdown in Q1 was transitory. Leading indicators, however, hint that there still may be some roadblocks in terms of consumer spending and business production.

Geopolitical risks could work in favor of LTCUSD and other digital currencies once more with uncertainties stemming from Europe. In particular, the trouble in Greece and Italian banks are in the spotlight, along with the snap elections in the UK.

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