Technical Analysis and Market Entry: LTC/USD Bears in a Position to Abolish the 2019 Recovery
- Litecoin has attempted to form some stabilization, following the harsh continuous selling seen since June.
- LTC/USD price action is moving within consolidation mode, subject to breaking from a bearish flag structure.
LTC/USD: Recent Price Behavior
The Litecoin price has tumbled as much as 65% since late June, having recently just bounced off the lowest levels since March. There was a heavy bout of selling for Litecoin that came into play; this was seen between 19 – 24 September. The price dropped a chunky 30% within the noted period; it was the most consecutive daily fall observed for around five months. Litecoin, like many of its peers, continues to remain stuck within a stubborn bearish trend.
A stronger wave of downside pressure had come into play for Litecoin when critical support was breached in July. During the recovery run of 2019, the buying pressure was taken up a notch on very late in April. The price was initially being supported to the upside by a long-running ascending trend line. Market bears, however early in July forced a breach of this important support. The door was left wide open to much selling, which is yet to slow down.
LTC/USD has attempted to stabilize over the past sessions from 25 September, as the price consolidates following the steep fall. Price action has formed a bearish flag structure through this recent consolidation. It does appear vulnerable to further downside risks, given the technical behaviour. Similar price movement was observed before the most recent drop as earlier described.
The narrowing in price action would suggest an imminent breakout from the flag pattern. Another fall could very well see LTC/USD being forced to give back 100% of its 2019 recovery gains. It does appear that Litecoin is just one support away from seeing such an outcome. The price at the time of writing can be seen trading within that key demand zone; it sits around the $55-60 region.
Given the above-detailed bearish flag formation, further moves to the south are still eyed for now. In terms of targets to the downside; $45, $40 and then finally $30, where the price was trading at the beginning of 2019. Entry would be around the current market price, as the price moves within the flag. Stops to be placed just above the structure and supply zone at $65.50.
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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