With Bitcoin (BTC) about as exciting as drying paint this week, some high-cap altcoins are seeing a bit of movement in the past days with Litecoin (LTC) being one of them.
We start on the 12-hour chart, and we can see that what had looked like a failed breakout from a falling wedge in fact turned into a fakeout-breakout from the wedge. Falling wedges are considered generally bullish, and it often transpires that patterns will break the “wrong” way and then fake back the “right” way as has happened here.
Two important levels on this chart are the 21 and 55 exponential moving averages (EMAs), the orange and purple lines respectively. Price broke out of the 21 EMA barrier that had been containing it, and has now tested and been rejected at the 55. A retest of the 21 EMA area, if it holds, might signal the chance for another leg up on this pairing.
Coming down to the 4-hour chart with MACD indicator, we can see that LTC is just now testing the inflection line of the pattern – looking like a head-and-shoulders pattern. We don’t see much rollover on the histogram yet, but the MACD is well in positive territory which will make a reversal – if it comes – pretty potent.
Here we are waiting for an outcome, as if price can hold here at the inflection point at about ₿0.0067, we could well see another leg up and higher into the support band – or maybe even out of it.
How has this translated to the USD pairing? Litecoin price has been picking up, and seems to be forming a small ascending triangle which is a bullish pattern. Again, we see the same 21/55 EMA range, although price looks likely to re-break the 21. There has been no volume pickup on this chart (Coinbase), suggesting that traders perhaps are trading out a stagnant Bitcoin.
We see the RSI trending up, and if this trend can hold we could take it as a potential buy signal. The histogram is getting consistently higher highs, and the MACD is close to bouncing bullish on the positive side. All in all, the indicators don’t look great yet, but they could look good pretty soon.
As stated above, with Bitcoin so boring, this is the perfect time for a bit of altcoin action. Bitcoin dominance is at extremely high levels, and the risk-reward for some cautious altcoin trades can’t be anything but good.
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