Trade Recommendation: Litecoin (LTC)
Litecoin (LTC/USD) is a market that has lost its bullish steam over the last few weeks. After posting a 2019 high of $146 on June 22nd, the cryptocurrency went into a downward spiral. It plunged to as low as $76.63 on July 16th. That’s a drop of over 47% in less than a month.
The good news is that the market is showing signs of short-term bearish exhaustion. This means we can take advantage of this dip and play the bounce.
Technical analysis shows that LTC/USD is respecting support of $75. We have this view because the market quickly bounced even before it touched the support. This is a bullish sign as it tells us that buyers are protecting the support.
Also, the bounce happened because the daily RSI was flailing oversold signals. While the bounce was short-lived, we believe that the next one will reignite the market’s uptrend.
The strategy is to buy on dips as close to $75 as possible. We are confident that this demand area will hold because there are three support levels converging at this level. In addition to the horizontal support, there’s also the uptrend line as well as the 200-day moving average. These supports will help keep prices from falling further.
As long as the market trades above $75, the initial target is $100. Take that out and $120 is next.
The process may take less than a month.
Daily Chart of Litecoin/US Dollar on Coinbase
Summary of Strategy
Buy: As close to $75 as possible.
Target: $100 and $120.
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.
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