By Alicia Maher
Coinglass data indicated liquidations worth $364 million within the past day. That came after Bitcoin dropped approximately 7% in a day. Meanwhile, the altcoin market mimicked Bitcoin’s footsteps, dropping substantial percentages. Litecoin was among the tokens that reacted to Bitcoin’s dip with notable declines. Litecoin’s long-term view was to search for opportunities inside the range that Litecoin formed within the last three months.
Litecoin 1 Day Timeframe
Litecoin printed a range in May-June, which remained unbroken. Furthermore, the mentioned range had its mid-point at $54. While publishing this blog, LTC seemed to drop below the midpoint, heading towards the $52 support. Meanwhile, this foothold was short-term support, and LTC might lose it. A daily closing below $54 would welcome a shorting opportunity. Short traders might place their stop losses just beyond $55. A revisit of $42 – $44 would reveal take-profit targets.
Reasoning
The daily chart RSI (Relative Strength Index) has hovered between 60 and 40 within the last two months. That confirmed the absence of a massive trend behind LTC on the 24-hour chart. However, this finding was lucid, considering the range formation. Moreover, it backed the notion that LTC was yet to witness a range breakout.
The Stochastic Relative Strength Index printed a bearish cross in the overbought region before plummeting lower. Combined with the Relative Strength Index’s dip below the 50-neutral, Litecoin’s momentum switched to bearish.
The OBV (on-balance volume) noted some uptick in August but failed to break a resistance mark from May. It encountered rejection at this hurdle again, plummeting lower. Sellers dominated the space once more, increasing the chances of further downsides.
Final Thought
A ‘buy’ opportunity would surface upon a revisit to $42 – $44. Longs would have a much better risk-reward at that value area. Litecoin has to climb past the $54 level to escape a bearish bias over the coming week. LTC fans should also watch broad market cues for profitable moves. Bitcoin wasn’t steady either, though it boasted support at $18.5K and then $17.8K. A Bitcoin rebound would mean some Litecoin relief.
Stay tuned for the latest developments in the crypto space.