Litecoin (LTC) has had an interesting week, after first falling out of a breakout pattern and then quickly reversing its course back up. The leading altcoin is now endeavoring to put in a higher low on both its LTC/BTC and LTC/USD charts, and preserve the possibility of finally bottoming-out on its longs retracement from summer highs.
We look on the 12-hour LTC/BTC chart to get a full impression of what’s happening. Litecoin recently plowed up through the 21 exponential moving average (EMA) from its bottom, before being held at the 55. But the 21 has been lost in the past day, probably because of a small Bitcoin bounce; and LTC is now retesting a support zone just below the 21.
The indicators don’t say much, although the histogram has just closed with a very slight arc up at time of writing. Volume has been very low, and sell volume especially low, perhaps signalling that Litecoin can hold here. Holding this support zone would constitute a higher low off of the recent bottom.
On a 12-hour LTC/USD chart, we see a similar but slightly more bullish picture. Here, the 21 EMA is holding well, with price refusing to close outside the range between the 21 and 55. The histogram is arcing up here as well, and the MACD is about to cross into the positive side just like on the BTC pairing.
Here, an ascending triangle looks to be in play, and we can reasonably expect this uptrend to continue throughout September toward a break up. Volume remains a problem, however, with almost none of it coming in to support this price level.
Finally, coming down to the 4-hour chart with MACD indicator (LTC/BTC), we see that the histogram is definitely curling up and will likely cross to the positive side within the coming day. Price may soon retake the 55 EMA on this timeframe after easily holding the local support level.
But we see that this holding probably has more to do with a lack of sell pressure than a surfeit of buy pressure: very little has come in, or even appears to be necessary, to float this higher low. After all this time of searching for bottom, perhaps sell pressure has simply evaporated for the leading altcoin.
A close on the 4-hour above this clutch of EMAs could serve as a entry signal for another leg up, especially if supported by bullish indicators and/or stronger buy volume. It’s definitely worth watching.
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