Litecoin’s bullish run from July to November 2021 triggered massive upward movements that stopped around the 61.8% Fibo resistance. Since then, the alt has witnessed steep downtrends amidst many reversal setups.
The broad market retracement stalled Litecoin’s northbound attitude from 23.6% Fibo resistance. A possible break from the current reversal setup might brace LTC for a $114 retest. While publishing this content, Litecoin traded near $104.68.
Litecoin Daly Chart
Meanwhile, buyers defended the 14-month long foothold of $98. Therefore, Litecoin recorded a more than 45.9% ROI from the February 24 yearly lows to explore the 23.6% zone. However, BTC’s weekly double-digit drop had LTC crashing within a falling wedge on the daily chart.
That way, the Exponential Moving Average ribbons took a bearish overturn after sellers intensified massive drops that pushed the alt towards the Bollinger bands’ lower limit. Moreover, bears dominated the long-term bias, and the 200EMA remained pessimistic.
A possible break beyond the current reversal formation may trigger an optimistic revival, taking LTC towards the closest trend-line resistance. Furthermore, the short-term EMAs stayed steep, meaning the alt might extend a squeeze phase inside the $114 – $106 range.
Reasoning
The Relative Strength index saw its momentum fading after Litecoin touched the 23.6% Fibo ceilings. The indicator dipped into a downward channel, reflecting sellers’ dominance. A decisive recovery beyond 38 would suggest a short-term recovery that bulls may capitalize on for returns.
Meanwhile, the Aroon indicators’ acute polarity keeps LTC’s bullish hopes alive. As the Aroon up neared the zero-level, revivals from this mark would favor buying activities.
Final Thought
While LTC oscillated within falling wedges’ confines as the price neared the Bollinger Bands’ lower border, the alt had a solid potential to hit the $114 mark in the upcoming days. Bears would then attempt to lower the currency and trigger a constricted phase as the 20 Exponential Moving Average remained south.
Furthermore, Litecoin shares a whopping 93% monthly correlation with Bitcoin. LTC enthusiasts should watch Bitcoin’s trend for profitable moves. BTC traded around $40,115.74 at this publication, losing 0.04% over the past 24 hours (Coinmarketcap data).
