LTCUSD failed in its recent attempts to break below support at $110, creating a double bottom on its 1-hour chart. Price has yet to test and break past the neckline at $135 to confirm the potential uptrend.
The chart pattern spans $25 pips in height so the resulting breakout could be of the same size, taking LTCUSD up to $160 next. The 100 SMA is below the longer-term 200 SMA for now but seems to be attempting an upward crossover to reflect a return in bullish pressure.
However, stochastic is pointing down to show that sellers have the upper hand. RSI is also starting to make its way down so LTCUSD could follow suit. In that case, price could still make a brief pullback or even another test of support at $110.
Sentiment in the cryptocurrency industry has improved tremendously though, partly due to reports that big hedge fund families are looking to invest in the space. It was reported that Soros Fund Management secured internal approval to place bets on cryptocurrencies while analysts also noted that Rockefeller and Rothschild have begun making investments in the industry as well.
Cooling geopolitical risks have also renewed risk appetite in the financial markets, encouraging traders to put funds in riskier assets once more. This could keep LTCUSD afloat in the near-term as Q2 has proven to be historically positive for virtual currencies.
Also, the dollar does not seem to be banking on the FOMC’s hawkish bias after the central bank released the minutes of its latest policy meeting. Downbeat CPI is being blamed for these doubts as market watchers are still questioning the Fed’s tightening time line.
Looking ahead, risk sentiment could continue to play a role in litecoin price action, especially since the temporary weight from profit-taking leading up to the tax filing deadline is almost lifted.