LTCUSD is trending higher once more, moving inside an ascending channel connecting the latest highs and lows on the 1-hour time frame. Price is bouncing off the resistance and could be due for a pullback to support around $54.

The channel support lines up with an area of interest or former resistance, which means that plenty of buy orders might be waiting around that level. The 100 SMA has crossed above the longer-term 200 SMA to confirm that the path of least resistance is to the upside. This short-term moving average is also close to the channel support and might hold as a dynamic inflection point.

Stochastic is heading lower but is already closing in on the oversold region to indicate exhaustion among sellers. RSI has more room to drop so there might still be some selling pressure left. With that, LTCUSD could continue its correction to the channel support before making another test of the resistance around $58. A break below support, on the other hand, could be indicative of a downtrend.

There is still some geopolitical risk left in play and supporting cryptocurrencies like bitcoin and litecoin. These typically draw a lot of demand from investors who are still seeking higher returns in times of risk aversion as these assets are less exposed to potential declines, unlike stocks and commodities.

However, it’s also worth noting that the US dollar is enjoying strong support from the renewed focus on tax cuts. President Trump shared more details on the GOP framework for fiscal reform and this was enough to buoy US equities and the dollar higher.

At the same time, the prospect of a Fed rate hike in December and the start of balance sheet unwinding next month has been positive for the US dollar, putting downside pressure on LTCUSD. Although Yellen sounded a bit more cautious in her latest speech, upside surprises in data could continue to support this narrative and the dollar.

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