Technical Analysis and Market Entry: Litecoin (LTC/USD) – Strong Support Continues to Back a Big Recovery
- Litecoin (LTC) has been cooling but still managing to find strong support at the psychological $100 mark.
- LTC/USD bulls have plenty of significant support areas, providing the necessary comfort for a continued move north.
LTC/USD: Recent Price Behavior
The Litecoin price is trading at a critical area, which bulls must wake up and pick up momentum to the upside or face a deeper pullback. Over the past ten sessions, there has been a noticeable slowdown from the recovery path. LTC/USD had gained as much as 260% from the start of the bull trend earlier this year.
LTC/USD has been supported to the upside by a long-running ascending trend line, which has been in play throughout the 2019 recovery so far. The price most recently has seen the brakes applied. It occurred after printing the highest levels since June 2018, up at the $121 territory. A massive area of supply runs from $115-$130, and Litecoin last traded above this on 22nd May 2018.
Critical Demand Area
There is significant defending observed at the big psychological $100 price area, where a demand zone is noted. It runs from the $107-$97 range, a previous strong acting supply zone. Should the bulls fail to regather strength within the detailed region, then it could force LTC for a huge retest of the supporting ascending trend line.
The last time LTC/USD faltered within the earlier noted supply – the $115-$130 range – was back in May 2018. It was a period when the price was moving within consolidation mode before resuming further heavy downside pressure. Litecoin went on to drop down the lows seen at the back end of 2018, down at the $22 area.
Given the critical areas of support observed, it is going to have to take some severe bearish power to send Litecoin free-falling. Any dips that occur in price, the bulls have been without fail taking the opportunity to drive LTC further higher. In the current trend north, strong examples of the dips being bought have been witnessed in the back end of April and several times in May.
A buy from the current price territory is attractive, as LTC/USD has proven stability around the psychological $100 mark. Additionally, with the consecutiveness of dips being bought, taking a long position here could prove to be promising. In terms of targets, investors should keep an eye on a retest and break above the high in May. This should open the door for some minor resistance at around $135. Ultimately, in the near-term, the upside target would be $180, which was last seen on 5th May 2018.
Stops are to be placed below the $100 area at $95; if the price breaks below, then wait for a retest of the noted ascending trend line. It can be seen tracking around the $90-$88 region, where another opportunity for a long could then be provided.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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