Litecoin has broken above the resistance line discussed in At Resistance, giving the buyers an opportunity to add long positions. Litecoin is currently trading at $4.051, up 3.34% aided by a price jump in Bitcoin.
Since there is a strong correlation between Litecoin and Bitcoin, any pressure on Bitcoin will get reflected in Litecoin as well.
Read the latest technical observations of the daily LTC-USD price chart to get a better idea.
Litecoin Chart Structure – Now that Litecoin has breached the resistance, the target on the upside is $4.500. However, it must also be noted that the breached resistance will now act as the new support and a weakness on the part of bulls will see the price retest this support, which comes at around $3.820.
Moving Average Convergence Divergence – All the three components, MACD, Signal Line and Histogram are now in the negative region with respective values of -0.0500, -0.0006 and -0.0493.
Momentum – The Momentum indicator remains mired in the sub-zero territory with a value of -0.0945.
Money Flow Index – The MFI has advanced slightly to 32.6955.
Relative Strength Index – The 14-day RSI has appreciated only slightly from 45.8398 to 48.2476.
Litecoin should reach higher levels following this recent breakout, but that is based on certain conditions. Firstly, Bitcoin should not topple immediately, otherwise, that will derail the progress in Litecoin market. Secondly, bulls must protect the new support from profit booking or renewed selling.
Sustaining above $4.150 will be the first indication that buyers are getting back in control.
Market participants should add to long positions if the price falls to the mentioned support level. They must also consider getting out of their long trades when the price meets the target of $4.500.