Trade Recommendation: Litecoin
Trading Litecoin (LTC/USD) is a lot of fun. We’ve mapped out the ranges and this now enables us to anticipate its moves with reasonable confidence. For instance, our January 11, 2019 trade recommendation for Litecoin hit both of our targets. They were achieved yesterday, February 8, when the market spiked by over 35%. Those who followed the trade recommendation grew their investments by over 40% in less than a month.
While others were scrambling to enter long positions yesterday, we were happy to take profits. A big move like this cannot be sustained because it overheats technical indicators. Time must be given to the market so that it can consolidate its gains and enable technical indicators to cool down. With this in mind, we stay ahead of the curve as we prepare to buy the pullback.
Technical analysis shows that LTC/USD has convincingly broken out of an inverse head and shoulders pattern on the daily chart. This likely marks the market’s transition from accumulation to markup. This development may have signalled the start of Litecoin’s 2019 bull run.
Nevertheless, Litecoin is showing signs of weakness after yesterday’s surge. It appears to respect the 200-day moving average as resistance. In addition, it is in overbought territory on the daily. These technical setups tell us that a throwback is in order. We’ll do our best to buy the dip.
The strategy is to buy on dips as close to $36 as possible. If bulls hold this level, our initial target is the range high of $75.
The process may take a month.
Daily Chart of Litecoin/US Dollar on Coinbase
As of this writing, the Litecoin/US Dollar pair is trading at $43.74 on Coinbase.
Summary of Strategy
Buy: As close to $36 as possible.
Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.