Litecoin Price Technical Analysis for 5/5/2015 ÔÇô Shaky Grounds


Litecoin Price Technical Analysis for 5/5/2015 ÔÇô Shaky Grounds

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After rising from 1.30 to 1.50 last week, litecoin traded sideways over the weekend. After the start of the first global trading session, litecoin is still within this range, between roughly 1.41 and 1.50. Note that 1.40 is the central pivot of the 1.30-1.50 range, and holding above 1.40 thus maintains a slight bullish bias, just as holding above the 200-hour SMA shows a slight bullish bias as well.

Litecoin (LTCUSD) 1H Chart May 5
litecoin 1h chart May 5
(click to enlarge)

Although price is holding above the central pivot of last week’s price range, there are reasons to believe that┬álitecoin is testing shaky grounds.
1) BTCUSD has already completed a double top.
2) LTCUSD┬áhas broken below last week’s rising trendline.
3) The 1H RSI has fallen below 40, which reflects loss of the prevailing bullish momentum.
4) Price action shows long tails to the upside, which means bullish attempts were quickly faded as it attempted to reach the range high around 1.50.

If price does break below 1.40, litecoin will be poised to test the 1.30 low again.

Litecoin (LTCUSD) 4H Chart 
LTCUSD 4H Chart May 5
(click to enlarge)

A return to the 1.30 low would be in-line with the prevailing downtrend seen in the 4H chart. Note that if price breaks below 1.40, ltcusd would be under the 100-, and 50-period SMAs again. Having never broken above the 200-period SMA, the noted price action would signal bearish continuation, which has the 1.00, parity level in sight. 1.00 is the low on the year, marked by a dramatic┬ádown spike on April 9th. The market is currently “chew” through this tail.

Now, a break above 1.50 would be quite a significant bullish signal. The “tail-chewing” scenario would have to be shelved because above 1.50, the market has the 1.70-1.73 April highs in sight. The ability to make it to this resistance would mean a break above the candle that made the spike to 1.00. This would add to the scenario that the market is turning away from the low on the year and entering a bullish trend. Even tually, we would want to see price hold above 1.50 on a pullback to confirm this bullish trend scenario.

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Fan Yang

TheBitcoinNews.com – leading Bitcoin News source since 2012